Hirbour v. Reeding

• Decision Date: 31 August 1877
• Citation: 3 Mont. 15
• Parties: HIRBOUR, appellant, v. REEDING, respondent.
• Court: Montana Supreme Court

3 Mont. 15

HIRBOUR, appellant,

v.REEDING, respondent.

Supreme Court of the Territory of Montana.

August Term, 1877.

Appeal from Second District, Deer Lodge County.

KNOWLES, J., sustained the demurrer to the complaint. Hirbour declined to amend the same and judgment was entered for Reeding and Gassert, the defendants.

SHARP & NAPTON, for appellant.

The Statute of Frauds has no application to a contract of the character of the one in suit, and if it did, the part performance to the extent of the performance carries it out. Gore v. McBrayer, 18 Cal. 582;Skillman v. Lachman, 23 Id. 198;Duryea v. Burt, 28 Id. 577,Settembre v. Putnam, 30 Id. 490;Boucher v. Mulverhill, 1 Mon. 306; Story on Part. 127-129; Sts. U. S. on Mineral Lands; Browne on Frauds, §§ 234-236.

This was a mining adventure, which was unknown to the law at the time of the enactment of the Statute of Charles II, 29; Yale on Min. Claims, 233; Bradbury v. Barnes, 19 Cal. 620. The Statute of Frauds is to prevent frauds and is never extended in its application to a new matter, so as to work a fraud, which would be the result in this case. 1 Story's Eq. Jur. (8th ed.), §§ 330, 331. It never applies to a mercantile transaction. In the case of an indorser, part performance takes it out of the statute. 2 Story's Eq. Jur. (8th ed.), § 1522; 3 Pars. on Cont. (6th ed.), 59-60.

The question fairly presented in this case is, whether a prospector, under a verbal contract of copartnership, when a discovery is made, shall make a race for the recorder's office to prevent other partners from acquiring title to the entire property.

W. W. DIXON, for respondent.

A contract for a partnership in real estate is within the Statute of Frauds and void unless in writing. Cod. Sts. 393, § 6; Story on Part., § 83; Pars. on Part. 368; 3 Pars. on Cont. (5th ed.) 155; Pitts v. Waugh, 4 Mass. 424;Gray v. Palmer, 9 Cal. 616;Thorn v. Thorn, 11 Iowa, 146; Wilson v. Ray, 13 Ind. 1;Levy v. Brush, 45 N. Y. 589;Bird v. Morrison, 9 Wis. 551.

The California cases cited by appellant do not decide the point in issue. It was there held under the old statute that mining claims, placer and quartz, could be vested or conveyed without writing. In Montana, quartz claims are real estate.

The complaint does not show any such part performance of the alleged partnership contract as will take the case out of the Statute of Frauds, or authorize the court to decree a specific performance. There is no allegation of how much work appellant did on the lode, or its value, or that it was all he was required to do by the partnership contract. The allegations of the complaint may be true, and appellant may not have worked one hour on the lode. Appellant does not show that he performed, or offered to perform, his part of the contract. These are among the grounds of demurrer. These facts appellant must allege and prove to take the case out of the statute. 2 Estee's Pl. 483, §§ 27, 28; Denniston v. Coquillard, 5 McLean, 253;Colson v. Thompson, 2 Wheat. 336;Edwards v. Estell, 48 Cal. 194;Joseph v. Holt, 37 Id. 250;Mather v. Scoles, 35 Ind. 1;Chase v. Hogan, 6 Bosw. 431.

If the demurrer was well taken upon any ground, the judgment should be affirmed. 3 Estee's Pl. 744.

The real question in this case is, whether a verbal contract of copartnership in real estate, with no sufficient acts or performance alleged to take the case out of the plain provisions of the Statute of Frauds, will be enforced by the court.

BLAKE, J.

The action of the court below in sustaining the demurrer of the respondents to the complaint of the appellant is before us for review. The following facts appear in the complaint and must be taken as true upon this hearing. Hirbour, the appellant, and Reeding and Gassert, the respondents, entered into a verbal contract of copartnership in April, 1873, at Rocker City in this Territory, “for the purpose of prospecting for, locating, recording, pre-empting, developing and mining quartz lodes and other mining property in Montana Territory.” Each party was to have an undivided third interest in said lodes and property, and pay for one-third of the labor and other expenses incurred in carrying on the business of the copartnership. Under this contract, the Silver Girdle lode was discovered by the parties, but it was recorded in the names of the respondents by them April 23, 1873, when it should have been recorded in the names of the copartners. All the parties “worked upon and mined” this lode in July, 1875, and developed and “displayed great value” in the property. “Said work and labor were done and performed” by the parties “as copartners in obedience to, and under and by virtue of, said contract of copartnership.” After the lode had been recorded, certain persons, Young and Rouderbush, located and pre-empted under the name of the Burlington lode a part of the Silver Girdle lode. The conflict respecting the titles to the property was compromised, and Young and Rouderbush conveyed by a deed to the respondents July 29, 1875, thirteen hundred and fifty feet of the Burlington lode, which was included within the boundaries of the Silver Girdle lode. The respondents refuse to give the appellant an interest in the property, and have extracted therefrom a large quantity of valuable ore. The copartnership has not been dissolved, and there has been no accounting between the parties.

The respondents demurred to the complaint upon the following grounds:

That the contract of copartnership was within the Statute of Frauds of this Territory and void; and that the complaint was ambiguous in failing to state the amount of the work which was done by the appellant upon the lode, or its value, or the time when it was done. The court below sustained the demurrer, and judgment was afterward entered for the respondents.

The respondents claim that the allegation of the complaint respecting the amount of the work performed by the appellant on the property is ambiguous, but we think that it should be deemed an averment that the appellant performed his part of the conditions of the contract of copartnership. When this allegation is controverted by the respondents, the appellant must establish on the trial ““the facts showing such performance.” Civ. Pr. Act, § 68. Therefore the examination of one question will enable us to determine this appeal. If the contract of copartnership is valid we are of the opinion that the complaint contains the allegations that are necessary to empower the court to enter a decree requiring the respondents to convey to the appellant his interest in the property in controversy. Is this contract within the Statute of Frauds of this Territory? The following sections of the act relating to conveyances and contracts are pertinent to this inquiry:

“No estate or interest in lands other than for leases for a term not exceeding one year, or any trust or power over or concerning lands, or in any manner relating thereto, shall hereafter be created, granted, assigned, surrendered or declared, unless by act or operation of law, or by deed or conveyance in writing, subscribed by the party creating, granting, assigning, surrendering or declaring the same, or by his lawful agent thereunto authorized by writing.” Cod. Sts. 393, § 6. “The term ‘lands,’ as used in this act, shall be construed as co-extensive in meaning with land, tenements, hereditaments and possessory land claims to public lands; and the terms ‘estate’ and ‘interest’ in lands shall be construed to embrace every estate and interest, present and future, vested and contingent, in lands as above defined.” Cod. Sts. 394, § 22; 389, § 1.

It does not appear that the respondents have acquired the title of the United States to the property. Their interest in the lode may be lost or forfeited by abandonment, or a failure to comply with the laws of the mining district, the Territory or the United States. Counsel for both parties concede, what we consider a sound proposition, that the lode in dispute is real estate. Melton v. Lambard, 51 Cal. 258. We must apply to the contract set forth in the complaint the legal principles that govern copartnerships for the purchase and improvement of real property.

A partnership may be formed without any written articles between the parties. “After some question it seems to be settled that there may be a partnership for the buying and selling of land.” Pars. on Part. 37, n. f. According to the weight of the authorities which are conflicting upon the question, the contract of such a partnership need not be reduced to writing to make it valid. Pars. on Part. 7, n. d. We do not intend to review the cases in which this subject has been examined, but will refer to a number of the most recent decisions which we have read.

The supreme court of Indiana holds in Holmes v. McCray, 51 Ind. 358, that a parol agreement for a partnership for the purpose of dealing in lands is not within the Statute of Frauds. Chief Justice BIDDLE, in the opinion, says: “As between the partnership and its vendors or vendees in the sale or purchase of lands, the statute in all cases would operate; but as between the partners themselves, when they are neither vendors nor vendees of one another, we cannot see how the statute can affect their agreements.”

In New York, the same views are announced in Chester v. Dickerson, 54 N. Y. 1, and Fairchild v. Fairchild, 64 Id. 471. Chief Justice WADE in his concurring opinion quotes from the opinion of the court in Chester v. Dickerson, supra, and this reference is therefore sufficient.¹ The same matter is considered in Traphagen v. Burt, 67 N. Y. 30, and the court comments on the case of Levy v. Brush, 45 Id. 589, which is relied on by the respondents, and says: “In the case cited ( Levy v. Brush, supra), the plaintiff had done no act of performance, advanced no money, nor parted with any thing under the contract, nor had the land been accepted, possessed and treated as joint property, nor improvements made...