Gold, Silver & Tungsten, Inc. v. Wallace

• Decision Date: 10 April 1939
• Docket Number: 14148.
• Citation: 104 Colo. 273,91 P.2d 975
• Parties: GOLD, SILVER & TUNGSTEN, Inc., v. WALLACE et al.
• Court: Colorado Supreme Court

91 P.2d 975

104 Colo. 273

GOLD, SILVER & TUNGSTEN, Inc., v. WALLACE et al.

No. 14148.

Supreme Court of Colorado, En Banc.

April 10, 1939

Rehearing Denied June 12, 1939.

Error to District Court, Boulder County; Claude C. Coffin, Judge.

Action by Donald F. Wallace, as executor of the last will and testament and of the estate of Frank E. Wallace, deceased and others, against Gold, Silver & Tungsten, Inc., for injunction to prevent removal of ore from a vein, the apex of which was allegedly within territory covered by plaintiffs' claim, a judgment quieting title of plaintiffs' claim, and damages for ore which defendant had removed and injury to plaintiffs' workings, wherein defendant filed a cross-complaint. Judgment for plaintiffs and dismissing defendant's cross-complaint, and defendant brings error.

Affirmed.

HILLIARD C.J., dissenting.

John R. Wolff, of Boulder, and Horace N. Hawkins of Denver, for plaintiff in error.

Ralph S. Newcomer and Goss & Hutchinson, all of Boulder, for defendants in error.

KNOUS Justice.

The defendants in error, plaintiffs in the court below, were the owners and lessee of the Gray Copper lode mining claim. The plaintiff in error, defendant below, was the owner of the Fitchburg lode mining claim. The parties will be designated herein as they appeared in the trial court. Plaintiffs alleged that certain ores mined by the defendant, although lying within the lateral boundaries of the latter's Fitchburg claim, extended downward, in fact, were extracted from plaintiffs' Gray Copper vein, the apex of which was within the territory covered by their claim. Plaintiffs prayed for injunctive relief, a judgment quieting title to the Gray Copper claim in them, and damages for the ore removed and injury to their workings. The answer of defendant alleged that any ore taken from beneath the surface and within the boundaries of its Fitchburg claim was from a vein which had its apex within the area of that claim. By way of cross complaint defendant asserted that through underground mining workings extending from the Gray Copper claim, the plaintiffs had entered Fitchburg territory and mined and removed ore from a vein apexing in the defendant's claim and belonging to it. An accounting of all ores allegedly so removed by plaintiffs, judgment therefor, and injunctive relief were sought by defendant.

The seniority of defendant's Fitchburg claim over plaintiffs' Gray Copper claim is admitted. The southwesterly portion of plaintiffs' Gray Copper claim overlaps in part the northwesterly portion of the Fitchburg claim. The Gray Copper patent excludes the overlapping area and as a consequence the easterly sideline of the Fitchburg claim is a common sideline between the areas of the Fitchburg and Gray Copper claims with which we are here concerned. The Gray Copper vein at its apex crosses the northerly end line of the Gray Copper claim and extends in a general southwesterly direction on that claim between the sidelines thereof along a course which is substantially parallel thereto to a point near the intersection of the easterly sidelines of the two claims, where the vein departs from the Gray Copper claim. The apex of the Fitchburg vein, as involved in this controversy, lies very near the easterly sideline of that claim, and runs approximately parallel to the apex of the Gray Copper vein, about 60 feet westerly therefrom, with the common sideline between the two apices.

The plaintiffs' Gray Copper claim was first developed by a series of shafts sunk from its surface area. Later the Gray Copper vein below the bottom of these shafts was opened and developed approximately 300 feet beneath the surface by means of a horizontal drift known as the Nancy tunnel, about which stopes or raises were made on the vein and connected with the shafts which previously had been sunk from the surface. The defendant's group of claims, of which the Fitchburg was one, had been developed through the Wood Mountain tunnel, the portal of which is located west of the area in conflict and which intersected the Fitchburg ground at a depth of about 500 feet below the surface, and was the defendant's only workings on the Fitchburg at the time this controversy arose. In these prior operations the Gray Copper vein produced a considerable amount of marketable ore; the Fitchburg none. In the fall of 1931 plaintiff Scruggs leased the Gray Copper claim, and in the course of his operations drove a drift from the Nancy tunnel on the Gray Copper vein across the Fitchburg sideline into the defendant's Fitchburg claim to an intersection with the vein therein, here in controversy, where an ore body was encountered and from which a considerable amount of ore was shipped. Upon learning of this work within the vertical boundaries of its Fitchburg claim, defendant made certain investigations and surveys and in 1933 notified plaintiff Scruggs that he was trespassing on the Fitchburg vein. Scruggs, however, claimed that the vein upon which he was working was the Gray Copper vein which on its dip had crossed the sideline of the Fitchburg property. In August, 1934, largely to determine the identity of the vein in the area in conflict, the defendant started to sink the Fitchburg shaft on the Fitchburg vein at the surface and continued this shaft to a depth of about 200 feet, where it encountered a flat of intrusive material which apparently cut off the downward course of the vein. A crosscut was then extended from this shaft to the disputed vein and ore body, and a lateral drift was driven on the vein 70 feet southwest and 33 feet to the northeast to define its course and strike. In January, 1935, Scruggs, who had continued to operate, shipped two carloads of ore from the disputed area to the Golden Cycle mill, upon which, by application of defendant, settlement was withheld. Later by stipulation of the parties the proceeds from this ore were deposited with the clerk of the district court of Boulder county to abide the judgment. Defendant likewise continued with the work through drifts and crosscuts from the Fitchburg shaft, in the progress of which some ore was removed by it, and in October, 1935, this suit was instituted by plaintiffs.

At the first trial plaintiffs contended that the disputed vein, which they designated the West Branch of the Gray Copper vein, was a split from their discovery vein which in its downward course had dipped across the Fitchburg sideline into the disputed area, from whence it continued downward and reunited with the main Gray Copper vein at a point or points in the vicinity of the Nancy tunnel level. The junction below of the disputed vein and the Gray Copper discovery vein is not in serious controversy. The plaintiffs also alleged that the main Gray Copper discovery vein on its dip crossed the Fitchburg sideline into the disputed territory. Upon this premise they asserted extralateral rights and so justified following the vein into Fitchburg territory. 30 U.S. C.A. § 26, U.S. R.S. § 2322; Rico-Argentine Mining Co. v. Rico Consol. M. Co., 74 Colo. 444, 223 P. 31. The defendant, on the contrary, contended that the main Fitchburg vein and the disputed vein were correlated by a series of footwall branch veins forking from the Fitchburg discovery vein which continued downward and united with the disputed vein; that the area between the Fitchburg vein and the disputed vein, through which these branch veins were alleged to pass, was really a mineralized zone legally constituting a broad lode connecting the two; that the disputed ore body and vein was made by the junction of these footwall branches and mineralized zone therewith, and that the Fitchburg vein was the controlling apex for its branches. Defendant further asserted that even if the vein in dispute was a split from the Gray Copper discovery vein, nevertheless, by virtue of the seniority of the Fitchburg claim, defendant was entitled to the whole vein downward from the point of union of the highest Fitchburg branch vein therewith under the applicable federal statute. U.S. R.S. § 2336, 30 U.S. C.A. § 41.

After an extended trial the district court orally announced its findings to the effect that plaintiffs' West Branch vein was a split from the Gray Copper discovery vein and upon the basis of the upward declination of the vein as exposed in certain crosscuts driven from the Fitchburg shaft projected to the surface, concluded that said West Branch vein did not apex within the Fitchburg surface area and said the evidence indicated that its apex was within the surface boundaries of the Gray Copper claim at or near the outcrop of the discovery vein. The court further found that the Fitchburg vein, neither by absorption nor through its alleged footwall branches, made any connection with the West Branch vein.

During the progress of the first trial and in the period allowed for filing motion for new trial, the defendant had proceeded with its exploration through workings driven from the footwall side of the Fitchburg shaft and in due course filed a motion for a new trial based upon evidence newly discovered in these operations. In the affidavit supporting the motion it was alleged that workings on the disputed vein, at this point said to be a mere veinlet, from or adjacent to a drift driven from the Fitchburg shaft (44 foot level) had disclosed a pegmatite flat where the vein entirely ended and ceased. Defendant asserted that this revelation fixed the highest terminal point of the vein, in effect a blind apex, as being within the lateral boundaries of the Fitchburg claim, extended downward, thus discounting the court's announced conclusion and establishing defendant's right to the vein. Among other matters it was further set out in the affidavits that the extension of another...