Cotton v. Rand

• Decision Date: 19 June 1899
• Citation: 51 S.W. 838
• Court: Texas Supreme Court
• Parties: COTTON et al. v. RAND.

51 S.W. 838

COTTON et al. v. RAND.

Supreme Court of Texas.

June 19, 1899.

Error to court of civil appeals of Fourth supreme judicial district.

Action by Noyes Rand against Frank B. Cotton and others. From a judgment of the court of civil appeals affirming a judgment for plaintiff (51 S. W. 55), defendants bring error. Reversed.

Millard Patterson and W. B. Merchant, for plaintiffs in error. Leigh Clark, W. M. Coldwell, and W. B. Brack, for defendant in error.

GAINES, C. J.

The defendant in error, Noyes Rand, brought this suit against plaintiffs in error, Frank B. Cotton and others, on the 12th day of September, 1893. He obtained a judgment, which was reversed by the court of civil appeals. Cotton v. Rand, 29 S. W. 682. The cause was again tried upon a fourth amended original petition, filed May 4, 1898, and again resulted in a judgment for the plaintiff. That judgment having been affirmed by the court of civil appeals (51 S. W. 55), this writ of error has been sued out to reverse it.

The suit was brought to recover a salary alleged to have been earned by the plaintiff as agent under a contract made by F. B. Cotton, for himself and others, and also for certain expenditures claimed to have been made by plaintiff as such agent. The alleged agency grew out of certain joint ventures of the parties to this suit and others in certain mineral and suburban lands. The first venture had its origin in a written agreement entered into in April, 1880, by the plaintiff, Noyes Rand, Francis W. Abney, Richard W. Dorphley, P. B. Delaney, and Clarence P. Ehrman, as parties of the first part, and by defendant Cotton, for himself and others (whose names are not disclosed in the writing), as parties of the second part. The stipulations of that agreement were as follows: "First. That all options now held by said parties of the first part, or any of them, for the purchase of mineral lands in the state of Texas, as well as all options for such purchases as they may hereafter secure, and any and all such purchases as they may hereafter make, and all mineral lands already located, or that may hereafter be located, by them in the state of Texas, shall be for the joint benefit of the parties to this agreement, in the proportion of one-half interest to the parties of the second part. Second. That said parties of the second part will furnish the necessary amount of money, not exceeding thirty thousand ($30,000) dollars, to pay the cost of such lands as may be selected by the parties of the first part out of any such as are now controlled, or as may be secured hereafter, and that they will send a representative to such point as may be designated by parties of the first part to examine said lands, as soon as so required to do, such representative to be authorized to pay for same as soon as he shall examine and approve of them and the proper deeds and titles shall be furnished; said deeds to be made in the name of Frank B. Cotton and Edwin B. Buckingham, as trustees for the respective parties to this agreement. Third. That parties of the second part hereto will pay to the parties of the first part the sum of seventeen hundred and twenty-three ($1,723) dollars, to reimburse outlays already incurred by them, including the cost of about six tons ore now in transit from St. Louis, Mo., to Philadelphia, Pa., which ore shall thereupon become the property of the parties hereto for their joint benefit, such payment to be made upon the execution of this agreement and the delivery of said ore at such point as may be indicated by the parties of the second part hereto. Fourth. That the parties of the second part will advance the sum of not exceeding thirty-five hundred ($3,500) dollars to meet the cost of outfit and the necessary expenses of their aforesaid representative, and of such of the parties of the first part as may go to Texas to attend to this business, and to pay them for their service in such employment, which advance shall be reimbursed out of the future earnings of this enterprise. Fifth. That parties of the second part will furnish such further amount of money as the parties hereto may decide as needed for developing the lands under this agreement, and for carrying out the plans to be hereafter agreed upon by said parties hereto, the entire amount so furnished to be reimbursed out of the net earnings of the enterprise before any dividends shall be declared on the capital stock of the company to be formed as hereinafter provided. Sixth. That said parties of the first part agree that Noyes Rand and Francis W. Abney will personally go to Texas at once, and attend to the purchase of the land as aforesaid, and to carry out the plans of the parties hereto, for the space of three months from date of this agreement, if necessary, receiving, as compensation for their service while so employed, two hundred ($200) dollars each per month, besides the cost of their outfit and necessary traveling and other expenses, and will also secure the services of Clarence P. Ehrman, at the rate of one hundred ($100) dollars per month and expenses, to assist them, such payments to be met out of the advance hereinbefore provided to be made by the parties of the second part. Seventh. That as soon as the parties of the first part shall have secured such lands as they may decide upon, and the deeds therefor shall have been executed and received, a meeting of all the parties hereto, in person or by proxy, shall be held, in such place as may be mutually agreed upon, and a company organized under a charter to be obtained under the laws of Texas, or of such other state as may be decided upon, with such an amount of capital stock and of such par value per share as the parties hereto may determine, and directors and officers shall be elected to manage the business of said company, each of the respective parties hereto having an equal representation in the board of directors, but the officers to be of the party of the second part, or such as may be acceptable to them of the parties of the first part. Thereupon the titles to all lands that may have been purchased shall be properly vested in said company in due legal form, and full-paid stock of the company shall thereupon be issued to the respective parties hereto in the proportion of one-half of the entire capital stock to the parties of the first part, or in such other divisions as the respective parties may agree among themselves. Eighth. That all lands that may be located or patented under this agreement shall be assigned to the hereinbefore named trustees by the individual in whose name they are to be located, under a written agreement to be executed at the time of authorization of such location in his name. Ninth. It is further agreed that none of the individual members of the respective parties hereto shall directly or indirectly operate in mineral lands or mineral products of the state of Texas, within the district which this agreement is intended to cover, unless by consent of the other party hereto."

The second contract was entered into December, 1880, by F. B. Cotton of the first part, and Rand and Dorphley of the second part. Its stipulations are as follows: "That all purchases of land, leases, mining rights, and interests or real estate, in general, west of the Mississippi river (not embraced in a certain contract between the parties hereto and their associates, bearing date April 17, 1880), which may be made after November 19, 1880, by either or any of the parties of the second part hereto or their associates, shall be for the joint account and interest of the parties hereto and their associates, and no others, during the continuation of this agreement, or any contract that may be executed in accordance with it, said interest to be apportioned as follows: Two-thirds of all profits arising from such purchases to accrue to Frank B. Cotton and his associates; one-third, to Noyes Rand, R. W. Dorphley, and their associates. It is agreed and understood, as the conditions upon which this agreement is based, that the necessary funds for making the aforesaid purchases, for meeting the necessary expenses, and for such improvement or developments as may be agreed upon between the parties hereto, are to be furnished or secured by said Frank B. Cotton and his associates; that said Noyes Rand and R. W. Dorphley will attend themselves, or through competent representatives, to securing, purchasing, and getting in proper condition for development, improvement, or sale, as may be agreed upon, any purchase that may be made under this agreement; that the party of the first part and his associates shall not be held to any purchases of leases unless approved by him and his associates, or for a greater sum than $2,000, for expenses, unless expressly authorized by him or them; and that the titles to estates, leases, mining rights, and interests shall be vested in Frank B. Cotton, as trustee, for the purposes hereof." This contract is signed by Cotton, for self and associates, and by Rand and Dorphley.

Under the first contract, more than 87 sections of mineral lands were acquired, and were conveyed, as provided therein, to F. B. Cotton and Edwin B. Buckingham, as trustees. Under the second contract, there was acquired for the parties thereto a tract of 550 acres of land lying adjacent to the city of El Paso, which is known as the "Cotton Addition" to that city. The title to this tract seems to have been taken in the name of Cotton, as trustee. Most of the parties to the venture in the mineral lands were also interested in the purchase and sale of the Cotton addition, but there were some parties interested in each who had no interest in the other enterprise.

About the month of August, 1881, Cotton, through a correspondence by mail and telegraph, entered into a contract with Rand, by which he engaged Rand to take the management, as agent, of the mineral lands and the Cotton addition for the term of one year, and, in...