Costello v. Cunningham

• Decision Date: 31 March 1915
• Docket Number: Civil 1382
• Citation: 147 P. 701,16 Ariz. 447
• Parties: MARY M. COSTELLO, as Executrix of the Estate of MARTIN COSTELLO, Deceased, Appellant, v. MARY AILEEN CUNNINGHAM and PATRICIA JULIA CUNNINGHAM, Minors, by and through EMIL MARKS, as Guardian of the Estates of Said Minors, Appellees
• Court: Arizona Supreme Court

147 P. 701

16 Ariz. 447

MARY M. COSTELLO, as Executrix of the Estate of MARTIN COSTELLO, Deceased, Appellant, v. MARY AILEEN CUNNINGHAM and PATRICIA JULIA CUNNINGHAM, Minors, by and through EMIL MARKS, as Guardian of the Estates of Said Minors, Appellees

Civil No. 1382

Supreme Court of Arizona

March 31, 1915

[Copyrighted Material Omitted] [Copyrighted Material Omitted] [Copyrighted Material Omitted]

APPEAL from a judgment of the Superior Court of the County of Cochise. Frank O. Smith, Judge. Reversed and remanded.

STATEMENT OF FACTS BY THE COURT.

This action was commenced on April 5, 1912, by Mary Aileen and Patricia Julia Cunningham, minors, as the heirs at law of Patrick Cunningham, deceased, by the guardian of their estate, Emil Marks, against the estate of Martin Costello and Mary M. Costello, as the executrix of the last will of Martin Costello, deceased, seeking an accounting for the net proceeds of the sales of 17 mines situate in the Warren mining district in Cochise County, Arizona, alleged to have been acquired by said Patrick Cunningham and Martin Costello in their lifetime pursuant to an agreement entered into by them in the year 1891. The said agreement upon which plaintiffs base their right to recover is set forth in the complaint, as follows:

"It was agreed that the said Costello should acquire the other undivided one-half of said claims [the claims referred to being the following named mines: Senator, Senator No. 2 Hope, Wagner and Pride, of which Patrick Cunningham was then the alleged owner of an undivided half interest], and that the said Costello and Cunningham should own said five claims in common, and that the said Costello and Cunningham should proceed further to acquire by purchase and location other mining claims in the vicinity of said five claims above mentioned, which claims, so purchased and located, should be owned by said Cunningham and Costello in common, and that the title to said five claims above named, and to all other claims so acquired, should be vested in the name of said Martin Costello, to be held by the said Martin Costello in trust for the use and benefit of said tenants in common."

It is alleged that in pursuance to said agreement Costello did purchase the other half interest in said five claims; also the said parties purchased four adjoining claims named, Irish Mag, George Washington, Old Republican and Angel, for the sum and purchase price of $6,000, to be paid out of the proceeds of a sale of said four claims; also they purchased the Buckeye claim for the sum of $300; also they purchased the Giberalta claim for the sum of $1,000, each paying $500 of the purchase price; also that they located the Supplement, the Leo and the Roy claims, and contributed equally of the expenses of such locations; also that they purchased the Hattie Manchester claim for $250, the whole sum of which purchase price was paid by Cunningham, and they also purchased the Belflower and Smogler claims for the sum of $1,000, each paying one-half of the purchase price; that the parties, pursuant to said agreement, caused the record titles to all of said unpatented claims to be vested in Martin Costello to be held by him as aforesaid. It is further alleged: That the said parties proceeded to and continued to perform the annual work on all of said mining claims, and to perform the patent work thereon up to the time of the death of Patrick Cunningham, and thereafter Martin Costello continued to perform the necessary annual work and further patent work on the claims sufficient to warrant the issuance of patents therefor. That each contributed his portion of the said expenditures up to the time of Cunningham's death. That patents were issued to, and in the name of, Martin Costello, to the claims on the dates as follows: to the Giberalta, March 11, 1895; to the Hope and Wagner, May 24, 1895; to the Senator, Senator No. 2, Buckeye, and Pride, June 4, 1895; to the Irish Mag, November 3, 1899; to the George Washington, Angel and Old Republican, November 3, 1899; to the Belflower and Smogler, March 1, 1900; to the Hattie Manchester, March 1, 1900; to the Supplement, May 1, 1905; and to the Leo and Roy, October 18, 1905. Plaintiffs allege:

"that after the death of said Patrick Cunninghham, the said Martin Costello sold all the said mining claims at the times, in the manner, and for the amounts hereinafter specified, and received the proceeds of such sales, and that from the time he received such proceeds, he held the same in like manner and under the same agreement and trusts under which he held said mining claims, to wit: in trust for the use and benefit of said tenants in common, being himself and the said heirs of said Patrick Cunningham."

It is alleged and not controverted: That Patrick Cunningham died intestate July 1, 1899. That his heirs at law are his surviving wife, Julia Cunningham, and Mary Aileen Cunningham, an infant daughter of tender years, and Patricia Julia Cunningham, who was born to the surviving wife about four months after his death. That on May 17, 1900, Julia Cunningham was appointed, and on May 18, 1900, she duly qualified as administratrix of the estate of said Patrick Cunningham, deceased, and was duly discharged as such on the 20th day of August 1901. That Costello sold the Irish Mag, Old Republican, Angel and George Washington, patented mines, on November 9, 1899, for $200,000, and on the same date sold the Buckeye, Senator, Senator No. 2, Pride, Hope, Wagner and Giberalta, patented mines, for $300,000. That the purchase prices of which said mines were paid to him at the times and in the amounts following, viz.: November 9, 1899, 10 per cent, April 1, 1901, 70 per cent and April 1, 1902, 20 per cent. That on the 16th day of May, 1901, Julia Cunningham was duly appointed guardian of the estates of Mary Aileen and Patricia Julia Cunningham, and performed the duties of such guardian until March 14, 1912, when her letters were revoked and Emil Marks succeeded her as such guardian. That Costello sold the Supplement, Hattie Manchester, Belflower and Smogler patented mines, March 2, 1903, for $75,000 each, or for $300,000, and received payment therefor 25 per cent March 2, 1903, and the remaining 75 per cent September 2, 1904. That he sold the Leo and Roy, patented mines, May 14, 1904, for the sum of $169,112, and received payments therefor as follows: 10 per cent April 26, 1904, 10 per cent April 28, 1905, and 80 per cent October 26, 1906. That the total proceeds of the sales of all 17 of said mines was $969,112.

Plaintiffs allege that they are entitled to one-half of said total sum, viz.: to the sum of $484, 556, and for one-half of the purchase money paid by Patrick Cunningham for the Hattie Manchester, viz.: $125, and for one-half of the purchase money paid by Patrick Cunningham for the Belflower and Smogler mines, viz.: $300, making a total sum of $485,181, less a credit of $87,492, paid by Costello to Julia Cunningham as administratrix of the estate of Patrick Cunningham, and as an heir at law of said decedent and as guardian of the estates of said minors, and a further credit for expenditures laid out by Costello for work performed and for purchasing and patenting expenses and attorney's fees, amounting to not to exceed $100,000, one-half of which is justly chargeable to the estate of Patrick Cunningham, viz.: $50,000, claiming a balance due of $347,689, and interest thereon at the rate of 6 per cent from the date of the receipt of the proceeds of said sales. It is alleged that Julia Cunningham received the sum of $87,492, as above stated, administered the same, and upon the discharge of all the obligations of said estate and a distribution of said moneys she was discharged as administratrix of said estate. That the said sum and balance claimed is after-discovered assets to which the heirs at law are entitled. That Julia Cunningham has sold, and transferred to said Mary Aileen and Patricia Julia Cunningham all her right, title, claim and interest in and to the proceeds of the sales of said mines and the damages for the retention of the moneys, and that they, the said Mary Aileen and Patricia Julia, are the owners of said claims. It is alleged, and not controverted, that Martin Costello died on the 15th day of September, 1911, testate, leaving a will by which Mary M. Costello was designated as executrix of his will; that the said will was admitted to probate; that on October 8, 1911, said Mary M. Costello was duly appointed executrix of said will; that she immediately qualified as such executrix, and her letters have never been revoked; that on the 16th of October, 1911, said executrix published notice to creditors of the estate of Martin Costello to present their claims to said executrix within 10 months from the date of the first publication of such notice, and that plaintiffs did, on the 26th day of March, 1912, duly present the above-mentioned claim for allowance, but that on the same date the said claim was rejected and disallowed by the said executrix.

The defendant pleaded in abatement defect of parties plaintiff in that Julia Cunningham is a necessary party plaintiff and is not joined as such. This plea was overruled by the court and such ruling is not assigned as error by the defendant. Defendant demurred upon a number of grounds, and all demurrers were overruled. The first special demurrer alleges that "it appears upon the face of said complaint that plaintiffs have no legal capacity to sue therein," and that the administrator of the estate of Patrick Cunningham is a necessary party. The order overruling this demurrer is assigned as error. The orders overruling other demurrers are not assigned as error. The defendant, pleading to the merits of the case, denies in one form or another...