Connolly v. Bouck

• Decision Date: 18 November 1909
• Docket Number: 3,034.
• Citation: 174 F. 312
• Parties: CONNOLLY v. BOUCK et al. [1]
• Court: U.S. Court of Appeals — Eighth Circuit

174 F. 312

CONNOLLY v. BOUCK et al. ^[1]

No. 3,034.

United States Court of Appeals, Eighth Circuit.

November 18, 1909

Hugh Butler, for appellant.

Harvey Riddell, for appellees.

Before SANBORN and VAN DEVANTER, Circuit Judges, and WM. H. MUNGER District Judge.

WM. H MUNGER, District Judge.

One Patrick K. Connolly was possessed of certain mining claims in the state of Colorado. Having little means, he entered into an arrangement with his brother, Nicholas K. Connolly, in June, 1894, whereby Nicholas K. Connolly was to advance certain moneys for the development of the properties, and said properties should be owned equally, share and share alike, by Patrick K. Connolly and Nicholas K. Connolly. In pursuance of this agreement Nicholas K. Connolly furnished some moneys which Patrick K. Connolly used in developing the mines. In the fall of 1894 Michael Connolly, another brother visited defendant in Colorado, and it was then agreed that Michael Connolly should also advance moneys for the development of the claims, and that the claims should be owned, one-third by Patrick K. Connolly, one-third by Nicholas K. Connolly, and one-third by Michael Connolly.

This arrangement was assented to by Nicholas K. Connolly. There after Nicholas K. Connolly and Michael Connolly advanced moneys for the development of said properties until August 1900, they had advanced the sum of $114,513.43. Patrick K. Connolly, however, used some $7,000 of this money in the purchase of some stock in another mine. In August, 1900, Michael Connolly and Patrick K. Connolly, being together in Leadville, Colo., Michael Connolly representing himself and Nicholas K. Connolly, the following written agreement was executed:

'This agreement, made this 13th day of August, A.D. 1900, by and between Michael Connolly, of the city of Montreal, Canada, and Nicholas K. Connolly, of the town of Boonton, in the state of New Jersey, parties of the first part, and Patrick K. Connolly, of the city of Leadville, county of Lake, and state of Colorado, witnesseth as follows, to wit: That the management of the Dolly B mine and all other properties-- mining properties-- situate in the county of Lake and state of Colorado, and standing on the record in the name of either of the parties aforesaid, or in the name of either member of the said party of the first part, shall be taken and controlled by the said party of the first part until said party shall have realized the amount said party has contributed and furnished for the development or obtaining title thereto or expense in maintaining such title, either in litigation or otherwise, above and in excess of the proportionate share thereof; that the stock of the Big Six Mining Company, now in the bank to the credit of the said party of the second part, shall be delivered to the said party of the first part, to be managed as the other property of the company is managed; that either of the said parties may at any time obtain a purchaser for any or all of the said property at the best price possible to obtain therefor, which proposition shall be submitted to the other party, who shall have a reasonable time, under the circumstances, to obtain a better price, and, in case no better price can be obtained in such reasonable time, the said party of the second part shall have the preference and be entitled to buy at such price; and that when all of the advances of the said party of the first part as aforesaid shall have been repaid, either from the produce of the said property or from the sales made as aforesaid, as well as fifteen thousand dollars ($15,000) advanced to the said party of the second part in the year 1875, by the said party of the first part, together with legal interest on both sums, then the said party of the second part shall have the equal undivided one-third of whatever remains, which shall be legally conveyed or assigned to him by the said party of the first part. That the said party of the first part shall, within a reasonable time hereafter, exhibit the books of said party with regard to the said $15,000 to the said party of the second part, or his authorized agent, and if they demonstrate that a less sum than the said $15,000 was advanced to the said party of the second part, the said sum of $15,000 shall be reduced by the difference between the two sums.

'In witness whereof, the said parties have hereunto set their hands and seals in duplicate the day and year first above written.'

Nicholas K. Connolly died in February, 1901, leaving as his only heir Mary Connolly Andrews. After the death of Nicholas K. Connolly and the execution of the agreement of August, 1900, Michael Connolly advanced the further sum of $21,916.18, and Mrs. Andrews advanced $23,975.25, which was used in developing the mines. No profitable results were obtained by the development. While some $200,000 was received from ore taken from the mines, that amount was also expended, in addition to the advances before mentioned, in developing the mines. On account of a disagreement between the parties, and the unprofitable operations, further developments ceased, and in August, 1904, Michael Connolly and Mary Connolly Andrews filed their bill in the Circuit Court for the state and district of Colorado, setting forth said agreement, the advances of money, and other matters unnecessary to be considered, praying that an accounting might be had of the moneys advanced by said Nicholas K. Connolly and Michael Connolly and Mary Connolly Andrews, that the amounts advanced be decreed to be a lien upon said mining properties, and that the same be sold to satisfy said lien. During the progress of the suit Mary Connolly Andrews died. and the action was revived as to her interest in the name of Francis E. Bouck, administrator of her estate.

The defendant, Patrick K. Connolly, in his answer, alleged, among other things, that in June, 1894, he entered into an arrangement with his brother, Nicholas K. Connolly, to furnish him financial aid and assistance in the acquisition and operation of such mining properties, whereby it was agreed that all the properties which Patrick K. Connolly had then located and of which he was the owner, and all properties to which he might thereafter acquire title, should be developed, with the object and intention of uncovering any ore bodies that might be found within said locations, and place the same upon a paying basis, if such were possible and as a part of such arrangement it was agreed that said properties should be owned equally, share and share alike, by Patrick K. Connolly and Nicholas K. Connolly; that in the fall or winter of 1894 Michael Connolly proposed that he be admitted into the enterprise, offering to contribute one-half of the expenses and to furnish one-half of the sums that might be required from time to time to carry on the enterprise, and that the interests in the property should be changed so that he (Michael Connolly) should receive one-third interest therein, Nicholas K. one-third, and Patrick K. one-third, and that Patrick K. should continue...