Parrish v. Stratton Cripple Creek Mining & D. Co., 2139.

• Decision Date: 10 March 1941
• Docket Number: No. 2139.,2139.
• Citation: 116 F.2d 207
• Parties: PARRISH v. STRATTON CRIPPLE CREEK MINING & DEVELOPMENT CO.
• Court: U.S. Court of Appeals — Tenth Circuit

116 F.2d 207 (1940)

PARRISH v. STRATTON CRIPPLE CREEK MINING & DEVELOPMENT CO.

No. 2139.

Circuit Court of Appeals, Tenth Circuit.

November 4, 1940.

Rehearing Denied December 9, 1940.

Writ of Certiorari Denied March 10, 1941.

William H. Scofield, of Denver, Colo. (Andrew J. Reynolds and John J. Morrissey, both of Denver, Colo., on the brief), for appellant.

Thomas M. Burgess, of Colorado Springs, Colo., (David P. Strickler, of Colorado Springs, Colo., on the brief), for appellee.

Before PHILLIPS, BRATTON, and MURRAH, Circuit Judges.

Writ of Certiorari Denied March 10, 1941. See 61 S.Ct. 738, 85 L.Ed. ___.

PHILLIPS, Circuit Judge.

E. F. Parrish brought this action against The Stratton Cripple Creek Mining & Development Company,¹ a corporation organized under the laws of Wyoming, to recover damages for alleged breach of contract. The action resulted in a summary judgment in favor of the Mining Company upon the facts disclosed by the pleadings and a pre-trial stipulation. The facts thus disclosed are these: The Mining Company is the owner of extensive gold mining properties in the Cripple Creek District, in Teller County, Colorado. On June 14, 1935, the Mining Company entered into a contract with The Cripple Creek Milling Company² whereby the Milling Company agreed to build and operate, on a tract of land belonging to the Mining Company and situated in the Cripple Creek District, a mill for the treatment of gold ore produced from the mining properties of the Mining Company. The contract provided that the mill should be completed not later that six months from June 14, 1935, should be erected under the supervision of competent engineers, modern in all respects, and capable of treating at least 300 tons of ore per day; that the processes and metallurgy to be used in the mill should be subject to approval by a person designated by the Mining Company and adapted to the treatment of ore from the Cripple Creek District; that the Mining Company should be given the right to inspect all operations of the Milling Company; that the Milling Company would promptly discharge any man employed on or about the premises at the request of the Mining Company; that if improvements should be made in mining machinery or in the process of treatment, the Milling Company would equip the mill with such improved machinery and install the improved process; that the Milling Company should have the exclusive right to treat all ores produced from a designated portion of the Mining Company's properties for a term of 25 years; that the Milling Company would treat all ores produced by the lessees of the Mining Company not to exceed 300 tons per day; that the Mining Company should have the right to purchase the mill from the Milling Company during the life of the contract at its replacement value; that the Milling Company should have the right to terminate the contract by giving the Mining Company sixty days' written notice and that the latter should then have the right to purchase the mill at its then fair value. The mill was completed and put in operation in August, 1935. It had a capacity of 500 tons per day. The Myron Stratton Home, a corporation, the owner of all the stock of the Mining Company, advanced in excess of $200,000 to the Milling Company to aid the latter in financing the cost of constructing the mill.

On September 27, 1935, the Mining Company and Parrish entered into a written contract wherein it was recited that the Mining Company had contracted with the Milling Company for the treatment of ore "to be delivered" at the latter's mill, and that it was to the Mining Company's advantage that such "delivery" be made by a trucking company able to haul the ore in all weathers and seasons, and that Parrish represented he was able and willing to furnish such trucking service, and that he would "haul and deliver to said * * * mill all ore produced" by the Mining Company; and in which the Mining Company agreed to give to Parrish "the exclusive hauling of all ore produced on its property and destined"³ to the mill of the Milling Company, and to employ Parrish "to haul all ore produced by it on its own account," and to instruct its lessees "to employ * * * Parrish to haul all ore produced by them and destined"³ to such mill. The contract further provided that the Mining Company and its lessees should pay Parrish for such hauling twenty-five cents per ton for the first mile and ten cents per ton for each additional mile or fraction thereof from the point of loading to the point of delivery at the mill bins. The contract further provided:

"This agreement, * * * shall be for five (5) years from October 1st, 1935, unless sooner terminated for failure to comply with its conditions. * * *

"This contract shall not be construed as creating a joint enterprise, or as the creation of any contract of agency or employment, but shall be construed solely as according an exclusive privilege to an independent contractor upon the terms and conditions hereinabove set out."

Parrish purchased a large amount of equipment and built and improved roads to enable him to perform his contract with the Mining Company. He entered into the performance of the contract on September 27, 1935. From that date to January 24, 1937, Parrish and the Mining Company and its lessees performed and carried out the provisions of the contract.

During that period there were times when the ore produced by the Mining Company's lessees did not equal 300 tons per day and Parrish hauled ore for other mining operators in the Cripple Creek District and was so engaged on January 24, 1937.

On the last-mentioned date, the Milling Company discontinued operation of its mill and it did not thereafter reopen the mill nor accept any ore for treatment. It was adjudicated a bankrupt on October 21, 1938, and on May 6, 1939, the mill was sold by the trustee in bankruptcy to Alfred G. Brown.

Neither the Milling Company nor the Myron Stratton Home had or exercised any control of the Milling Company by stock ownership or otherwise, and the act of closing the mill was wholly that of the Milling Company.

Prior to the erection of the mill, all the Mining Company's lessees made separate and individual arrangements with truckers for the transportation of the ore produced by them. Upon the closing of the mill, the Mining Company informed its lessees that they were no longer required to permit Parrish to haul their ore. After the closing of the mill, Parrish contacted the lessees of the Mining Company and made arrangements with certain of them to transport their ore from the mines to railroad sidings for shipment to the Golden Cycle Mill at Colorado Springs, Colorado. These arrangements continued from ...