Nygard v. Dickinson

• Decision Date: 24 May 1938
• Docket Number: No. 8640.,8640.
• Citation: 97 F.2d 53
• Parties: NYGARD et al. v. DICKINSON et al.
• Court: U.S. Court of Appeals — Ninth Circuit

97 F.2d 53 (1938)

NYGARD et al. v. DICKINSON et al.

No. 8640.

Circuit Court of Appeals, Ninth Circuit.

May 24, 1938.

W. C. Arnold and L. O. Gore, both of Ketchikan, Alaska, for appellants.

Ziegler & King, of Ketchikan, Alaska, for appellees.

Before GARRECHT, HANEY, and STEPHENS, Circuit Judges.

GARRECHT, Circuit Judge.

The appellees, as plaintiffs, brought suit against the appellants, praying that they be decreed the owners of an undivided one-third interest in certain mining claims situated in Alaska; that they be decreed entitled to an undivided one-third interest in the sum of $30,000 agreed to be paid by defendant Evis Corporation to defendants Nygard and Nuckolls, in payment of the purchase price of said mining claims.

At the trial the following facts were brought out:

In 1904 Gunder Nygard located a mining claim which he named the "Goo Goo", near Sea Level, Thorne Arm, in the Ketchikan Mining and Recording District, First Division, Territory of Alaska. In 1907 Richard Nuckolls located a claim known as the "Goo Goo No. 1", or "Goo Goo Extension", or "United States". Gunder Nygard and Richard Nuckolls had been friends since 1900 and these claims were adjacent. Before locating the No. 1 or Extension, Nuckolls acquired an interest in the Goo Goo claim. Nuckolls had agreed with Nygard in 1904 to purchase the Goo Goo claim for $12,000, but did not pay all of the purchase price. After Nuckolls acquired the Extension another agreement was entered into whereby they put the two claims together and became partners. After acquiring an interest in the Goo Goo claim he and Nygard gave an option to other parties to mine the property, but these persons did not continue operations. Afterwards Nuckolls and Nygard conducted mining operations and took out considerable gold. Between 1908 and 1922 this mining property was leased to several people and from twelve to eighteen thousand dollars worth of work was done on the two claims. Nuckolls said that there was always a dispute over the property.

Gunder Nygard left Alaska in 1910 and at the time of the trial was over seventy years of age and resided in the State of Washington. He did not testify either as a witness, or by deposition. Nuckolls transacted all business relative to the claims after Nygard left Alaska and advised Nygard from time to time of his acts and received Nygard's approval.

On June 22, 1922, pursuant to an agreement with the appellees, Nuckolls signed the following memorandum: "This is to certify that as half owner and having power of attorney from Gunder Nygard, I hereby agree to give Doctors G. E. and B. P. Dickinson one third interest in all claims we possess at Sea Level, Thorne Arm, Alaska, if they will obtain a patent for the same and do the assessment work for this year up to July, 1922. Should they not obtain a patent the assessment work is to be paid for out of the first gold obtained." This writing was witnessed, acknowledged and recorded. The Dickinsons proceeded to do the assessment work in 1922 and 1923, but did not obtain a patent. For the following six years, between 1924 and 1930, the Dickinsons did no assessment work and made no effort to get a patent, although Dickinson made numerous trips to the property with Nuckolls, using his power boat, and furnishing the gasoline, oil and food. In 1928 Dr. Dickinson made a trip to Seattle at Nuckolls' request with the purpose of selling or leasing the claims. Nuckolls was there and Dickinson paid all the expenses for ten or twelve days. Nuckolls never repaid the money spent on the Seattle trip. During that period the assessment work was done by Nuckolls. The Dickinsons had been interested with Nuckolls in mining claims at Helm Bay since the year 1914.

In June, 1930, the Dickinsons secured the services of William Hesse, a Territorial Highway Engineer, to survey the mining claims at Thorne Arm for the purpose of obtaining a United States patent. On June 15, 1930, George Dickinson took Mr. Hesse and Nuckolls to the claim and left Hesse there, returning to Ketchikan. Shortly thereafter Hesse returned to Ketchikan, complaining that he had no one to assist him. On June 21st the party again set out in Dickinson's boat, taking along an extra man to help in surveying the claims. When the boat had traveled only a short distance from the shore, Nuckolls and Hesse engaged in a heated argument, and Hesse demanded to be put back on shore. Dickinson had taken no part in the argument. Dickinson put the boat back to the dock and the party landed. Hesse testified at the trial, "Nothing that G. E. Dickinson or Mrs. B. P. Dickinson said or did, in any manner contributed to the decision I made to turn back to town and to refuse to make said survey. It was the fault of Richard Nuckolls." On the same day Nuckolls advised Mrs. Dickinson that there were only a few days remaining before June 30th, 1930 to do the assessment work for that year. Nuckolls secured five men to do the work and the Dickinsons agreed to pay the expenses, and furnish the food, supplies and transportation. Mrs. Dickinson testified that on June 25th Nuckolls advised her and Dr. Dickinson that they were to have a one-third interest in the mine in return for doing the assessment work for 1930. Dr. Dickinson said that he understood that by the agreement of June 25, 1930, he was relieved of the necessity of procuring the patent. Nuckolls denied this agreement and stated that the Dickinsons were to procure the patent to entitle them to a one-third interest, but said that he believed Dr. Dickinson tried in good faith to have the survey completed in 1930.

The Dickinsons also caused the assessment work to be done in 1931, securing the services of W. E. Green and his son and furnishing them with supplies. Green gave them a certificate for $200 worth of assessment work for the year 1931. Green was living at the time in a house owned by the Dickinsons and the rent was applied against the value of his services over a period of twenty months. The Dickinsons paid him in rent.

Thereafter the Dickinsons did no more assessment work. In 1935 Dr. Dickinson learned, for the first time, that the claims had been sold by Nuckolls and Nygard to the Evis Gold Mines Corporation. The Dickinsons then sent a notice to Nuckolls, Nygard, Alaska Ketchikan Gold Mining Company and Evis Gold Mining Corporation, of their claim to an interest in the property. On August 23, 1935, George Dickinson sent a letter to Nuckolls notifying that he was ready to proceed to obtain a patent and requesting advice whether Nuckolls considered the contract between them in force or not.

It was brought out in the testimony for the defendants that the Evis Corporation took an option to purchase the property for $30,000 in 1933 and commenced to work it in October, 1934, and up to the time of trial had spent approximately $80,000 developing it, and had paid defendants, Gunder Nygard and Richard Nuckolls, $19,500 and deposited in a bank in Ketchikan, pursuant to order of court, $4,000.

Nuckolls denied that he agreed to give the Dickinsons a one-third interest in the claims for doing the assessment work for 1930 but said that he agreed to give a one-third interest if they procured a patent. He said further that he told Dickinson that he would renew the contract if he would do the assessment work and get the patent "and when he didn't get the patent naturally he had to do the assessment work."

The Evis Gold Mines Corporation agreed to pay thirty thousand dollars for the Goo Goo claim and nothing for the Goo Goo Extension claim, according to Nuckolls' testimony.

Questioned on the agreement of June 22, 1922, Nuckolls testified that he had a power of attorney from Nygard; that the power of attorney might have run out or been destroyed by him; that he wrote Nygard of the agreement; that Nygard knew all about it; that Nygard wrote him that the agreement was satisfactory; and that he (Nuckolls) no longer had the letters. Counsel for the defendants made no objection to this testimony but did move to strike it on behalf of Gunder Nygard.

Nuckolls decided to rescind the contract and deny any rights to the Dickinsons at the time he gave an option on the claims to one Olson in 1933; Dr. Dickinson, so Nuckolls testified, wanted to sign the option agreement with Olson, as a partner but that he refused. Nuckolls said, however, that he did not stop the Dickinsons from getting a patent, but that they could have secured a patent right up until he sold the claims, without objection from him.

At the conclusion of the trial the court delivered an oral opinion; findings of fact and conclusions of law were entered May 20, 1937; and decree entered in favor of plaintiffs, on the same day.

The appellants assign twenty-seven errors, eleven of which are not relied upon. The remaining assignments are divided by appellants into five groups, but we do not find it necessary to confine ourselves to this grouping.

The facts as pleaded and proven sustain the findings and judgment of the court. Nygard never turned his hand or spent a cent to preserve or improve the property after 1910 and all that saved Nuckolls, and incidentally Nygard too, from loss of the claim on several occasions were the Dickinsons and their continued readiness to advance the necessary money. Were it not for certain legal questions raised, affirmance would be a mere matter of course.

It is argued that Nuckolls was without power to bind Nygard — a question perhaps technical or formal, possibly fundamental. We, therefore, proceed to a discussion of the authority of Nuckolls as an agent, and if no such authority is shown, does the conduct of Nygard establish ratification or estoppel.

A mining claim is property in the fullest sense of the word, and may be sold, transferred, mortgaged, and inherited without infringing the title of the United States, and when a location is perfected, it has the effect of a grant by the United States...