Costello v. Scott

• Decision Date: 02 January 1908
• Docket Number: 1,723.
• Citation: 93 P. 1,30 Nev. 43
• Parties: COSTELLO et al. v. SCOTT et al.
• Court: Nevada Supreme Court

93 P. 1

30 Nev. 43

COSTELLO et al. v. SCOTT et al.

No. 1,723.

Supreme Court of Nevada

January 2, 1908

Appeal from District Court, Churchill County.

Suit by Thomas J. Costello and another against Murry Scott and others. From a decree in favor of complainants, defendants appeal. Affirmed as to all the defendants except N. R Fitzpatrick, and reversed and new trial granted on certain of the issues between plaintiff and defendant Fitzpatrick.

Thos S. Ford, for appellants.

McIntosh & Cooke, for respondents.

NORCROSS J.

This is an appeal from the judgment and an order denying defendants' motion for a new trial. The action was brought by respondents, alleging a copartnership for mining purposes between themselves and defendant Murry Scott. They prayed for a decree dissolving the alleged copartnership, for the appointment of a receiver, for an accounting, and for other appropriate relief incidental to the dissolution of the copartnership. The nature and character of the copartnership between respondents and defendant and appellant Scott is alleged in the complaint as follows: "That on or about the 8th day of December, 1905, the plaintiffs and defendant made and entered into a contract and agreement in and by which it was then and there mutually stipulated, contracted and agreed by and between said plaintiffs and defendant that they would engage together as copartners in the business of prospecting for, discovering, locating, leasing, acquiring and working mines and mineral claims in the counties of Nye and Churchill in the state of Nevada, and in such other counties and places in said state as might be subsequently agreed on; that said defendant should give his time and attention to said business, and should furnish his work, labor, and services necessary for the purposes of said business, and that the plaintiffs should from time to time advance and pay the expense of said business, exclusive of defendant's said labor, and until said business should become self-sustaining; that any and all property so discovered, located, or in any manner acquired by said defendant should be held and owned by said plaintiffs and defendant in common, each (that is to say, plaintiffs) having, holding, and owning an undivided one-half part, share, and interest therein, and the defendant having, holding, and owning the remaining undivided one-half part, share, and interest therein; that the proceeds of any and all sales, options for sales, working bonds, or leases arising from, or in any manner or wise accruing out of, said business and property so acquired should be divided, as aforesaid, between plaintiffs and defendant, share and share alike; that plaintiffs and defendant should have, hold, and own, as aforesaid, respectively, an undivided one-half interest of, in, and to any and all mines and mining claims located or otherwise or in any manner acquired in pursuance of said agreement or subject thereto, and should have, hold, and own an undivided one-half interest, as aforesaid, of, in, and to all profits, proceeds of sales, or other consideration arising from said business."

The answer of defendant Scott denies that he ever entered into any contract of copartnership with the plaintiffs Costello and Newhall, and denies that he had ever entered into any agreement or business relations whatever with the plaintiff Newhall. He further alleges that he and the plaintiff Costello did enter into "a (so called) grub-stake agreement," which was confined exclusively to the Goldyke district, in Nye county. The nature of this agreement is set forth in defendant Scott's answer to be as follows: "By the terms of said agreement, the plaintiff Costello was to furnish money to this defendant, and with said moneys defendant was to purchase necessaries to support him, and materials for working said mines, and the said contract was fully performed and carried out by this defendant; but the amount of moneys furnished by said Costello was wholly inadequate and insufficient for the purposes designated. The said defendant was to locate and acquire title to mines, and as far as he could, and his time permitted, was to do preliminary work thereon, required by the laws of Nevada to be performed within 90 days after location; and after being so located, and the title acquired, the said Costello and defendant were to be equal owners therein, and each was to own an undivided half thereof. The said understanding or contract had no other terms, and the said conditions, so described, constituted the whole thereof, and there was no agreement as to how long said contract should last, and no time was fixed when it should terminate; but it was mutually understood by and between the parties that said contract might be dissolved at the will of either party, when it appeared to him that the same became unprofitable, or for other reasons he desired to terminate the same, and the said agreement between Costello and Scott was dissolved and terminated prior to the time that the said business association or partnership of Mays, Savage, and Scott was formed." It is alleged in the pleadings and shown by the proofs that on or about the 23d day of May, 1906, the defendant Scott, who was then at the town of Fairview, in Churchill county, joined defendants Mays and Savage in a prospecting expedition. These three parties, two days later, discovered the mines of Wonder, about 20 miles from Fairview, which proved to be of great value.

The main contention, upon the merits in this case, is plaintiffs' claim to an equal interest with Scott in the fruits of his discovery at Wonder, by reason of the alleged partnership. The case came on for trial in Churchill county before the court, with the aid of a jury. Special issues were submitted to the jury, which, in the main, were answered in favor of the contention of defendant Scott. To the question, "Was the partnership or grub-stake agreement confined, or intended to be confined, to the Goldyke district, in Nye county?" the jury answered "Yes." Upon the question as to whether there was a partnership agreement, as contended for by plaintiffs, the answer of the jury was in the negative. Also, in reference to the contention of plaintiffs that they had, shortly before the Wonder trip, sent him $50, upon which he was subsisting at the time of the said discovery, the jury answered in the negative. These may be regarded as the principal special issues submitted to the jury, and are sufficient to notice for the purposes of this opinion.

After the jury had returned its verdict upon the special issues submitted, respective counsel entered into a stipulation "that any and all further hearings, arguments, and proceedings to be had before the court in said cause may be had, heard, and taken before the court at Reno, in Washoe county, Nevada; *** that an order may be made by the court for a change of venue in said cause for any and all purposes of said cause." The stipulation also contained another provision governing "any further accounting in said cause." Upon this stipulation the court entered an order transferring the cause to Washoe county, where the case was finally argued and submitted. Upon the 3d day of January, 1907, the court rendered its decision, in which it rejected the conclusions reached by the jury upon the special issues, and found in favor of plaintiffs' contentions, and entered a decree accordingly. Defendants' counsel filed exceptions to the findings of the court, and in due time moved for a new trial upon the grounds of errors of law occurring during the trial, insufficiency of the evidence to justify the decision of the Court, and that the decision, findings, and judgment of the court are not supported by the evidence, but are contrary thereto. The motion for a new trial was heard by the successor in office of the judge who tried the case, and the motion denied. The case comes to this court in a transcript of nearly 1,400 pages, and the questions presented are ably and elaborately discussed by counsel in 350 pages of brief.

1. The first question, in logical order, is whether the court had power to set aside the verdict of the jury upon the questions of fact submitted to it, and substitute contrary findings of its own. In a purely equity case, it is well settled in this state that a party cannot demand a jury as a matter of right. The calling of a jury in such a case is a matter of discretion with the judge. "In such a case, when there are contested questions of fact, the chancellor may, and oftentimes should, call a jury to assist him in arriving at a just conclusion; but the verdict is merely advisory, and only to satisfy his conscience. If he is not satisfied with it, he can and should disregard it. If it is satisfactory, he can and should adopt it, and file his findings and decree accordingly." Duffy v. Moran, 12 Nev. 97; Lake v. Tolls, 8 Nev. 290; Van Vleet v Olin, 4 Nev. 95, 97 Am. Dec. 513. It is contended, however, in this case that the answer of defendant Scott raised a legal issue upon the question of the existence of the partnership, and that the finding of the jury upon this issue was controlling upon the court. Conceding that the answer did raise certain legal issues, it may be admitted that, if a jury had been called to try these issues, the court would not have power to disregard the verdict of the jury upon such issues, and make findings contrary thereto. But this is not the situation presented in this case. The jury was not called to determine the legal issues. The case was treated by all parties as an equitable proceeding throughout, and the right of the court to pass upon the legal, as well as the equitable, issues does not appear to have been questioned until after the jury brought in its verdict, and, so far as the...