Nichols v. Rogers

• Decision Date: 25 March 1885
• Citation: 29 N.E. 377,139 Mass. 146
• Parties: William H. Nichols v. Henry M. Rogers[1]
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

139 Mass. 146

29 N.E. 377

William H. Nichols v. Henry M. Rogers^[1]

Supreme Judicial Court of Massachusetts

March 25, 1885

Argued January 26, 1885 [Syllabus Material]

Suffolk.

Bill in equity, filed May 16, 1883, alleging that, on December 26 1881, the owners of a certain mine in Arizona executed a bond to one Dowley to convey the mine to him, on or before March 1, 1882, for $ 50,000; that on January 18, 1882, Dowley assigned the bond to William H. Nichols, the time of payment of the purchase money being extended to January 1, 1883; that on March 13, 1882, William H. Nichols agreed to sell one fifth of said mine and of said bond to the plaintiff, one fifth to the defendant, one fifth to one Saunders, and two fifths to other persons, the plaintiff making payment on account of his interest; that in November, 1882, William H Nichols became insolvent, and notified the plaintiff and the other purchasers that he could not pay the obligors in the bond the balance of the purchase money, and that they might negotiate directly with the obligors; that thereupon, on November 20, 1882, the plaintiff, the defendant, and Saunders executed an instrument, under seal, wherein they covenanted and agreed to and with each other as follows:

"1. To entrust to Henry M. Rogers the sole, absolute, and untrammelled control of our respective interests, authorizing him to distribute them as he from time to time may deem best, provided only that he reserves to us, respectively, some interest in the mine, or in the stock of the mine provided the mine be put into a stock company.

"2. The several sums of money paid or to be paid by us, respectively, to said Rogers, are to be used by him in such manner as his best judgment may approve. That such sums of money are not loaned to him or received by him for any purpose but to try to save to us, respectively, some portion of the money or of the mine to which we are respectively entitled under our respective agreements with William H. Nichols. Should such sums of money as have been or are to be paid to said Rogers be lost by him, he is in no event to be held personally responsible therefor.

"3. The said Rogers shall be entitled to receive from the shares of mine or money obtained by him a reasonable compensation for his time and services.

"4. The said Rogers, in consideration of the premises, agrees with the parties hereto, and with each of them, to use his best energy, skill, and judgment to bring to a successful result the recovery of the mine or the money of the parties hereto, and obtain for them substantial and positive benefits from his labors in the premises."

The bill further alleged, that the plaintiff and Saunders advanced money to the defendant, and that the defendant, on December 5, 1882, obtained a conveyance of two fifths of the mine, and on December 8, 1882, agreed to sell to one Miller one tenth of the mine, and on December 25, 1882, obtained a conveyance of two fifths of the mine; that the defendant now holds four fifths of the mine, less the one tenth sold to Miller, to wit, seven tenths of the mine, and all the personal property in trust for the benefit of the plaintiff, Saunders, and the defendant, who have each contributed one third of the purchase money; that on February 15, 1883, the plaintiff requested the defendant to convey to him his interest and render an account.

The prayer of the bill was that the defendant execute to the plaintiff a conveyance of seven thirtieths of the mine, and of one third of the personal property and all rights acquired under the bond and agreement.

On January 24, 1884, the bill was amended by alleging that the parties to the agreement did not intend, at the time of the making thereof, or afterwards, that the defendant had a right thereunder to hold said property for the purpose of working the mine, or of organizing a company thereunder; that neither of them had pretended that the defendant had such right, or to do anything further under the agreement; but that it was understood and conceded by all parties in interest that each party was entitled to receive a conveyance of his share as soon as the account of the defendant was settled.

The amended bill further alleged that the defendant bought of one Warren one tenth of the mine, and gave him therefor the sum of $ 1300, and also a tenth of the same mine, which last named tenth the defendant bought of one Chilson, and paid for with funds contributed by the plaintiff, Saunders, and the defendant; that the defendant now denies that the plaintiff has any interest in the tenth purchased of Warren, and claims to hold it to his own use; and that the defendant had not in this transaction acted in good faith, but had acted fraudulently and in bad faith.

The defendant demurred to the bill as amended, for want of equity.

The case was heard on the bill and demurrer, by Holmes, J., who ordered a decree to be entered sustaining the demurrer...