North Am. Uranium, Inc. v. Johnston, 2779

Decision Date08 October 1957
Docket NumberNo. 2779,2779
PartiesNORTH AMERICAN URANIUM, Inc., a Corporation, Plaintiff and Respondent, v. L. A. JOHNSTON, Defendant and Appellant.
CourtWyoming Supreme Court

R. G. Diefenderfer, Sheridan, and Maxwell Bentley, Moab, Utah, for appellant.

Thomas Morgan, Gillette, and John Hjellum, Jamestown, N. D., for respondent.

Before BLUME, C. J., and HARNSBERGER and PARKER, JJ.

Mr. Chief Justice BLUME delivered the opinion of the court.

This is an action to quiet title to certain mining claims known as the Jake claims and described as follows:

'Lode mining claims known as the Jake Claims numbered 1 to 18 inclusive, as located, surveyed, filed and platted, in Sections 19 and 20 in Township 41, North of Range 73, West of the 6th P.M., Campbell County, Wyoming, more particularly located as follows: S 1/2, and the South 360 feet of the S 1/2 N 1/2 of Section 19; and the West 120 feet of the W 1/2 SW 1/4 and an oblong tract 360 feet north and south by 120 feet east and west in the southwest corner of the SW 1/4 NW 1/4 of Section 20, Township 41, North of Range 73, West of the 6th P.M., Campbell County, Wyoming.'

On July 6, 1955, the following document was made and executed by and between Peter Mileski, Jr., and Harold T. Mankin on the one hand and L. A. Johnston on the other, the document being signed on behalf of Johnston by F. A. Goodbrod, his partner or agent:

'Know All Men By These Presents:

'That Pete Mileski, Jr., & Harold T. Mankin, first party, and L. A. Johnston, second party, do hereby agree as follows, (by F. A. G.)

'Witnesseth:

'That the first party being the owner of the hereinafter specifically described lode mining claims, for and in consideration of Ten Dollars ($10.00) and other valuable consideration, does hereby sell, convey and assign to second party all of first party's right, title and interest thereto, except as hereinafter specifically provided, to the lode mining claims situated in Campbell County, Wyoming, and described as follows, to-wit:

'Jake No 1 to Jake 18, inclusive, claims. All claims lie in south half of Sect. 19. T-41 Range 73, with exception of two which lie in north east and north west of Section 19.

'Said party of second part, L. A. Johnston agrees to validate above claims. Said cost to be deducted from purchase price excepting and reserving however, to the first party, their heirs and assigns, a Five per cent overriding royalty of the gross proceeds of all ores and materials mined and marketed from said premises including all bonus, incentive and premium payments but excluding haulage and development allowances that may be paid in connection with the marketing of ore or materials from said premises.

'That the second party shall keep said mining claims in good standing as to validation or assessment work and recording of required assessment work affidavits and for each assessment work period shall, on or before 60 days before date of requirement for completion of the same, furnish to the first party, or assigns, proof that such work has been done and in the event that second party, or assigns, desires to give up or abandon said mining claims second party shall at the option of the first party furnish a conveyance or reassignment of all rights to said claims at least 60 days prior to time for completing annual assessment work thereon.

'This agreement is binding upon the respective parties hereto and their respective heirs and assigns, and the right of assignment or transfer or conveyance by either party of their respective interest, either in whole or in part, is hereby permitted.

'That the overriding royalty hereinabove specified shall be paid to first party by depositing 50 percent, or an overriding royalty of 2 1/2 percent, to the credit of Pete Mileski in the Stockmen's Bank at Gillette, Wyoming, and a like amount of 2 1/2 percent overriding royalty to the credit of Harold T. Mankin in the Stockmen's Bank at Gillette, Wyoming, such royalty to be paid to the credit of first party on or before the 20th day of the month following receipt of settlement by the second party for ores and materials marketed, and for settlement for bonus, incentive and premium payments and at such times the first party shall be furnished copies of assay and settlement sheets and a full accounting for all ores and materials removed from said claims; that payment of such royalty may be paid by the purchasing or paying agents in the event that such direct payment is permissible or should be paid in such manner. That first party shall have the right to examine the workings and records pertaining to said claims and should be given full information by the second party of all knowledge obtained by second party pertaining to evaluation of said claims as to mineral content thereof.

'That the second party is hereby granted the right of ingress and egress in and over said described property for the purposes of prospecting for, developing, mining, producing, removing and marketing ores and materials from said premises as may be permissible under said lode mining claims and rights thereunder; and the said first parties do hereby grant to the second party a private easement for access road to said mining claims from the public county road for mining said claims and marketing materials and across U. S. Staley Archibald land on the trail not travelled or adjacent thereto. John Moore reserves his rights otherwise as surface owner of lands covered by said claims.

'This agreement is executed in duplicate this 6 day of July, 1955, and each party hereto acknowledges receipt of an executed copy hereof.

'/s/ Peter Mileski, Jr.

'/s/ Harold T. Mankin

'First Party

'/s/ L. A. Johnston

'Second Party by F. A. Goodbrod' For convenience we shall hereafter refer to this document as a conveyance or instrument of conveyance. It was introduced in evidence by counsel for the plaintiff in the early part of the trial after cross-examination of the defendant under the statute.

On February 21, 1956, North American Uranium, Inc., a corporation, hereinafter referred to as plaintiff, bought the Jake claims and other claims from Mileski and Mankin. Thereafter, and on March 28, 1956, plaintiff filed its amended petition setting forth facts as in an ordinary action to quiet title, and further asked an injunction to prevent Johnston from removing any minerals from the Jake claims. A temporary injunction was issued. Johnston, the defendant, filed an answer and cross-petition. He alleged that he became the owner of the mining claims in question on July 6, 1955, and he asked that the title thereto be quieted in him. A reply was filed by plaintiff denying the affirmative allegations of the defendant, and again alleging that the plaintiff is the owner of the mining claims. The trial court entered judgment denying the defendant any right under his answer and cross-petition, quieting title to the claims in the plaintiff and absolving it from any liability under the bond given in connection with the issuance of injunction. From this judgment the defendant has appealed, assigning as error the admission of parol testimony to contradict and vary the terms of his written conveyance, and that the judgment of the trial court is contrary to the evidence and contrary to law. The controlling questions are those hereinafter discussed.

I. Unacknowledged Instrument and Notice Thereof.

Before proceeding further, we may incidentally mention that counsel for plaintiff seem to have been under the impression, and perhaps still are, that the conveyance to Johnston was invalid because it was not signed by Johnston personally, or by an agent who had a power of attorney duly acknowledged. They mention § 66-127, W.C.S.1945, which relates to the power of attorney which an agent must have in order to convey land. Of course it is elementary that an agent may be appointed to transact any lawful business for and on behalf of the principal. 1 Mechem on Agency, 2d Ed., § 80. For the agent to convey and interest in real property and have the conveyance recorded, he must have a power of attorney duly acknowledged. In this case, the agent did not undertake to convey any interest in land. He merely accepted a conveyance on behalf of his principal, and he had a right to do that under the general rules of agency.

In the case at bar the instrument of conveyance to Johnston was not acknowledged, and hence was not entitled to be placed of record under the laws of this State. Still it was perfectly good as between the parties. 1 C.J.S. Acknowledgments § 17, p. 796; 76 C.J.S. Records § 32, p. 130. The question then is whether or not it is good as to the plaintiff, a subsequent purchaser. The general rule is stated in 1 C.J.S. Acknowledgments § 17, p. 797, that an unacknowledged instrument is ordinarily effective 'except as to subsequent purchasers or creditors without actual notice.' Section 66-119, W.C.S.1945, states as follows:

'Every conveyance of real estate within this state, hereafter made, which shall not be recorded as required by law, shall be void, as against any subsequent purchaser or purchasers in good faith and for a valuable consideration of the same real estate or any portion thereof, whose conveyance shall be first duly recorded.'

We construed that statute in the case of York v. James, 60 Wyo. 222, 148 P.2d 596, 598. We there held that the burden of proof is on the subsequent purchaser to show that he purchased the property in question in good faith and without notice. In that case we approved the rule laid down in Bell v. Pleasant, 145 Cal. 410, 78 P. 957, 959, 104 Am.St.Rep. 61, where that court stated as follows:

"A subsequent deed by the grantor to another person does not of its own force convey any title, for the grantor having previously parted with his title, has left in himself nothing to convey, and his deed alone can therefore convey nothing. It can only be effective, as against the first grantee, when...

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