Smith v. Jack Pot Mining Co.
| Decision Date | 09 December 1939 |
| Docket Number | 7930. |
| Citation | 97 P.2d 368,109 Mont. 445 |
| Parties | SMITH et al. v. JACK POT MINING CO. et al. |
| Court | Montana Supreme Court |
Rehearing Denied Jan. 3, 1940.
Appeal from District Court, Sixth District, Gallatin County Benjamin E. Berg, Judge.
Action by I. Foster Smith and another against the Jack Pot Mining Company and others for damages for breach of contract. From an adverse judgment entered after a demurrer to second amended complaint was sustained without leave to plead further, the plaintiffs appeal.
Reversed and remanded for further proceedings in accordance with opinion.
E. F Bunker, of Bozeman, and Wellington D. Rankin and Arthur P Acher, both of Helena, for appellants.
W. S. Hartman, of Bozeman, for respondents.
This is an appeal from a judgment of the district court of Gallatin county, after a demurrer to the second amended complaint had been sustained without leave to plead further. The original complaint does not appear in the transcript.
On September 13, 1937, an amended complaint was filed, in which the appellants appeared as plaintiffs, and the respondent, together with five individuals who were directors of the respondent corporation, were the defendants. The action was for damages for breach of a contract set out in the amended complaint. General and special demurrers were interposed to that complaint, which were sustained in all particulars. A second amended complaint was filed on January 24, 1938, to which again general and special demurrers were interposed. The second amended complaint named only the respondent corporation as defendant. Judgment was entered for the individual directors on February 21, 1938, for the reason that they were not named as defendants in the second amended complaint. The court on April 14, 1938, sustained the demurrer of the respondent Jack Pot Mining Company in certain respects and overruled it in other respects. The general demurrer upon the ground that the second amended complaint did not state facts sufficient to constitute a cause of action was sustained on April 14th. On April 18th judgment was rendered in favor of the defendant and against the plaintiffs, in which it was recited that plaintiffs had not asked leave to amend the second amended complaint, "and said plaintiffs not being entitled to such leave" and "defendant is entitled to a judgment on the merits pursuant to the sustaining of said demurrer."
The individual defendants were included as respondents in the notice of appeal and in the title of the cause in this court, but are clearly not necessary or proper parties, since no appeal was ever taken from the earlier judgment entered in their favor. The appeal is therefore hereby dismissed as to them, on the court's own motion; and they are entitled to their costs, if any such were separately incurred by them.
The sole specification of error argued by appellants is based on the action of the district court in sustaining the general demurrer and refusing the appellants leave to amend further.
The respondent filed with its brief a motion to dismiss the appeal on several grounds. For convenience we will consider first the specification of error assigned by the appellants.
The contract pleaded and relied upon in the second amended complaint is as follows:
"Agreement.
This Agreement made and entered into this 6th day of July, 1937, by and between the Jack Pot Mining Company, party of the 1st part, a corporation, organized, existing and doing business under and by virtue of the laws of the State of Montana with its principal place of business at the City of Bozeman, in the County of Gallatin, in said State, hereinafter called the Company, and I. Foster Smith and H. L. Pearl, of the City of Denver, Colorado, hereinafter called the party of the 2nd part.
That the Company has this day agreed and does hereby grant the party of the 2nd part the right to purchase all of the capital stock of the Jack Pot Mining Company, together with all rights for exclusive management, control and ownership of all properties of said Jack Pot Mining Company, more particularly described as follows:
The Boaz Quartz Lode Mining Claim patented, and the Golden Treasure Quartz Lode Mining Claim, unpatented, also Jack Pot Quartz Loade Mining Claim, being adjacent claims and located in Lower Hot Springs (unorganized) Mining District in Madison County, Montana, in accordance with the provisions hereinafter set forth.
The Company agrees to sell and hereby grants to the party of the 2nd part the rights to purchase the capital stock and said mining properties, together with the improvements and equipment at the date of said contract of purchase and sale at and for the purchase price of $125,000.00, payable as follows:
$25,000.00 on or before July 10th, 1937; $5,000.00 on or before September 10, 1937; $10,000.00 on or before October 10, 1937; $10,000.00 on or before November 10, 1937; $10,000.00 on or before December 10, 1937; $10,000.00 on or before January 10, 1938; $10,000.00 on or before February 10, 1938; $10,000.00 on or before March 10, 1938; $10,000.00 on or before April 10, 1938; $10,000.00 on or before May 10, 1938; $10,000.00 on or before June 10, 1938; and $5,000.00 on or before July 10, 1938. The purchaser to apply 25% of the net smelter returns to be deducted by the smelter on the said purchase price and to be credited on the purchase price as due by the Company as the same is received. The Company is to retain the ore in bins and in shipment and loose on the dumps, and to have ten days to remove the same. No interest is to be paid on deferred payments. The party of the 2nd part is to have until August 10, 1937, to purchase the properties and stock of the Jack Pot Mining Company, subject to the following condition. The party of the 1st part has agreed in writing with one W. E. Brodie that if the party of the 2nd part or their assigns does not complete the purchase of the Jack Pot Mining Company stock and properties by July 10, 1937, that said Brodie shall have until close of business on July 12, 1937, to purchase above described properties and stock. If no sale has been completed by close of business on July 12, 1937, this contract is to be construed as being in force and good standing until August 10, 1937. Contract of sale is to provide that the purchaser is to expend a minimum sum of $1,500.00 per month in development work on said mine, said development work to be planned and executed in good minerlike manner and to be so planned and executed as not to damage or decrease the value of said mine.
Purchaser is to have complete charge of the property upon payment of the first payment.
Representatives of Jack Pot Mining Company to have the privilege of inspecting the working of the mine at all reasonable times.
It is further agreed that the Company is to have the opportunity to investigate and determine the financial ability of any proposed purchaser and decide for itself whether or not it feels the proposed purchaser has sufficient financial ability to carry out this contract.
Time is to be of the essence of said contract of purchase and sale and on failure to make full purchase payments in manner and form as hereinabove provided, the contract is to be forfeited automatically and the payments theretofore made to be retained by the Company. The Company is to furnish abstract of title showing merchantable title to said property, and on full payment, to execute and deliver warranty deed for the property and its appurtenances and equipment.
In Witness Whereof, pursuant to a resolution of its Board of Directors heretofore unanimously adopted at a meeting thereof, the said Company has caused its name to be affixed by its President by said resolution thereunto duly authorized, and affixed its corporate seal thereto, and the party of the second part has hereunto set his hand and seal the day and year first above written.
[Corporate Seal.] President.
In Triplicate. I. Foster Smith
H. L. Pearl.
Party of the 2nd part."
A casual reading of the contract would indicate that there is some ambiguity in it; but the only material ambiguity is, to our minds, as to whether the contract is one whereby the appellants were to secure purchasers for the property, or one whereby the appellants were to...
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