Livesley v. Muckle

• Citation: 80 P. 901,46 Or. 420
• Parties: LIVESLEY v. MUCKLE et al.
• Decision Date: 15 May 1905
• Court: Supreme Court of Oregon

80 P. 901

46 Or. 420

LIVESLEY v. MUCKLE et al.

Supreme Court of Oregon

May 15, 1905

Appeal from Circuit Court, Columbia County; Thos. A. McBride, Judge.

Action by James Muckle and another against George F. Livesley, in which said Livesley filed a cross-bill. From a decree for plaintiffs (defendants in the cross-bill), defendant (plaintiff in the cross-bill) appeals. Affirmed.

On July 3, 1902, the defendants Muckle, being the owners of certain sawmill property in St. Helens, leased the same to Smith &amp Murray for a year, upon certain terms and conditions, with the provision that, if they desired at any time during the continuance of the lease, the lessors would sell and convey the property to them by a good and sufficient deed, conveying the title, excepting one lot which was to be conveyed by a quit-claim deed, upon the payment of $3,133.33 in cash; the balance of the purchase price, of $6,666.67, to be secured by a first mortgage on the property. Smith & Murray immediately went into possession of the mill, and soon thereafter organized the St. Helens Lumber Company, a corporation, to take over the lease and their rights thereunder. The mill company operated the mill until December, when it became financially embarrassed, and a receiver was appointed by the state court to take possession of its assets. Among its debts was one to the defendants for $2,000, money borrowed. About this time plaintiff, through some arrangement, the details of which are immaterial herein, with Smith & Murray and the lumber company, undertook to finance the enterprise and take care of the debts of the lumber company. He applied to the defendants for a confirmation of the lease of the property but they declined to negotiate with him until they had recovered possession; claiming that the conditions of the lease to Smith & Murray had been broken and the lease forfeited, and that they were entitled to possession of the property. Upon an application made by them to the court appointing the receiver, setting up the alleged forfeiture an order was made requiring him to deliver possession of the mill to them, which was done accordingly. They thereupon entered into the following agreement with plaintiff:

"Memorandum. In consideration of the sum of $2,043.66, to us paid by G.F Livesley, we hereby agree to and with the said Livesley that we will start the mill mentioned in the lease made July 3 1902, by us to Herman Smith and George P. Murray, and will demonstrate that the same can be successfully run, making good lumber; and that when this is done we will execute to said Livesley a lease conditioned in all respects as to the lease to said Smith and Murray is, but to end at the same time said lease ends.

"Provided, that in case any litigation shall grow out of the said lease, said Livesley shall defend such litigation, and our lease to him must be subject to such orders as shall be made therein; and in case we fail to demonstrate the fact that said mill can be successfully run and cut good lumber, we will return to said Livesley the said sum of money so paid by him, and negotiations between us will be all off. The expense of starting said mill, both for material and wages, shall be paid by said Livesley, who shall own the output thereof."

Upon the making of this agreement, plaintiff entered into possession of the mill, and proceeded to operate it without requesting or demanding of the defendants that they comply with their stipulation to demonstrate that it could be run successfully and make good lumber; and thereafter the defendants offered to execute to him a lease as agreed upon but he refused to accept it until certain pending bankruptcy proceedings against the mill company had been disposed of. About the time the term specified in the lease...