Rehearing
Denied June 29, 1936.
Appeal
from District Court, Fergus County; Stanley E. Felt, Judge.
Suit by
Ray Snider against E. W. Carmichael. From an adverse decree
defendant appeals.
Affirmed.
MORRIS
Justice.
This is
an action to terminate a contract between the parties, for an
accounting, and for a division of assets, or the sale of the
assets and division of the proceeds thereof.
For
several years prior to November 1, 1930, the defendant was
the owner of several bands of sheep which were let to various
parties in Fergus and adjoining counties to be run on shares.
One band was let to the plaintiff. On November 1, 1930, the
defendant owned and had let out approximately 11,000 sheep,
all breeding ewes except 1,600 ewe lambs, and on that date
the plaintiff and defendant entered into the contract
hereafter recited and referred to as Exhibit A of the
complaint. The contract provided that the business should be
carried on for one year and might be continued by mutual
agreement for an additional year. The record does not show
that the additional year was expressly agreed to on the
termination of the year covered by the contract, but the
business was continued without change until April 1, 1933, at
which time the second contract, Exhibit B of the complaint,
hereafter recited, was agreed upon, but was not executed
until July 29, 1933.
The
contracts, being the best evidence of the intention of the
parties, are set out in full, as follows:
"Exhibit A.
Agreement.
This Agreement made and entered into in duplicate this 1st
day of November, A. D. 1930, by and between E. W. Carmichael
of Lewistown, Montana, the party of the first part and Ray
Snider of Lewistown, Montana, the party of the second part
Witnesseth:
The party of the first part for and in consideration of the
covenants and conditions herein contained has agreed to sell
and the party of the second part for and in consideration of
the covenants and conditions herein contained has agreed to
buy an undivided one-half interest in all of the sheep now
owned by the party of the first part upon the terms and
conditions hereinafter set forth.
The sheep now owned by the party of the first part are more
particularly described as follows: [The list of names of
persons to whom the sheep were let and the number in
possession of each is omitted, the total having been
mentioned above.]
All bucks belonging to the first party which have been and
may hereafter be delivered to any and all of the various
parties to whom sheep have been delivered under the various
contracts hereinbefore mentioned.
All of said sheep branded with a black paint cross on the
back and all sheep hereafter acquired by the parties hereto
and the increase of said sheep hereinabove mentioned to bear
the same brand.
It is mutually agreed between the parties hereto that the
party of the first part agrees to sell and the party of the
second part agrees to buy an undivided one-half interest in
the sheep now out on the various contracts hereinabove
mentioned subject to all of the terms, provisions and
conditions of each of the said contracts hereinabove
mentioned.
The party of the second part agrees to pay for the said
interest in all of said sheep the sum of Forty-five thousand
three hundred and 50/100 ($45,340.50) Dollars, payable one
year from the date hereof, bearing interest at the rate of
eight (8) per cent. However, it is mutually agreed that all
moneys received from the sale of wool, sheep or lambs, prior
to the date of maturity of said purchase price, shall be
divided and the one-half part of the receipts from such
sources which would belong to the party of the second part
shall be applied in payment of any advances made by the party
of the first part to the party of the second part, the
interest on the purchase price and upon the purchase price.
Said receipts to be applied in the order herein mentioned.
The party of the second part agrees to furnish one-half of
the necessary expenses for the care of the said sheep and in
the event of his inability to furnish one-half of the
necessary expenses, the party of the first part agrees to
make such advances and if necessary, to provide the party of
the second part with the necessary living expenses. All of
which sums are to be treated as advances and paid as herein
mentioned.
It is mutually agreed by the parties hereto that a settlement
shall be made following the first of each and every month,
and all advances and receipts from the sale of sheep and wool
during the preceding month and the exact conditions existing
between the parties determined as of the date of the said
first of each and every month.
It is mutually agreed that each of the parties are to
contribute equally to the expenses of the care and
maintenance, market and otherwise handling of the sheep
hereinabove mentioned, except, however, that such expenses as
are herein mentioned which under the terms of the various
contracts hereinbefore mentioned between the party of the
first part herein and the third parties are to be borne only
in accordance with the terms, provisions and conditions of
the contracts.
It is further mutually agreed that the title to all of said
sheep now owned by the party of the first part, or any sheep
acquired by exchange, substitution or purchase shall be and
remain in and the property of the party of the first part
until such time as the purchase price hereinabove expressed,
together with the interest thereon and any advances made have
been paid, satisfied and discharged.
It is further mutually agreed that in the event of the death
of either party hereto within one year of the date hereof,
that the sheep now owned by the party of the first part, and
the subject matter of this contract, shall be sold and
one-half of the sale price so received to be paid to the
party of the first part and so much of the other one-half of
the same price so received as is necessary to pay the
purchase price here expressed, interest thereon and advances
paid to the party of the first part, or his executors,
administrators or assigns and the balance paid to the party
of the second part, his executors, administrators or assigns.
It is further mutually agreed that it is the intention of the
parties hereto that in the event the handling of the sheep
during the year commencing November 1, 1930, and ending
November 1, 1931, is mutually satisfactory to the parties
hereto to continue a like arrangement for one further year,
provided, however, that this provision shall not be an option
on the part of either party, but in order to make the
contract operative for another year it must be mutually
agreed upon by the parties hereto.
It is further mutually agreed that any sheep which may be
received by trade or exchange for any sheep, the subject
matter of this contract, shall be held subject to the
provisions herein.
It is further mutually agreed that neither party to this
contract shall sell or assign his interest therein without
the consent of the other party first had and obtained in
writing.
In Witness Whereof, the parties have hereunto set their hands
and seals on the day and year herein first above written.
(Acknowledgment.)
E. W. Carmichael [Seal.]
Ray Snider [Seal.]"
"Exhibit B.
Agreement.
This agreement, made and entered into in duplicate this 1st
day of April, A. D. 1933, by and between E. W. Carmichael, of
Lewistown, Montana, the party of the first part, and Ray
Snider, of Lewistown, Montana, the party of the second part,
Witnesseth:
That party of the first part hereby agrees to sell and
transfer, to the party of the second part, and the party of
the second part agrees to buy from the party of the first
part, an undivided one-half interest in Sixteen Thousand
(16,000) sheep, ranging in ages from one to five years
respectively, including Three Hundred (300) rams, for the sum
of 43,000 Forty Three Thousand Dollars, and which said sheep
are now on the range in the counties of Garfield and Fergus,
Montana, and all of which said sheep are branded with black
cross on back, and together with increase during the life of
this contract, shall be at all times so branded.
It is mutually covenanted and agreed by and between the
parties hereto that each of the parties hereto shall
contribute equally to the care, maintenance, grazing,
running, handling, shearing and marketing of said sheep, and
any and all other expenses incident to running and handling
said sheep, and in the event that party of the second part is
unable to advance his portion of the expenses incident to
running and handling said sheep, then party of the first part
will advance such money as may be required for expenses, with
the portion thereof chargeable to second party to be repaid
to first party out of the sale of wool and lambs; and it is
further expressly agreed that party of the second part shall
not acquire an interest in any other sheep or become
interested in or own any other sheep except by and with the
consent of the party of the first part first obtained in
writing.
It is further covenanted and agreed by and between the
parties hereto that Five Thousand (5,000) head of the said
sheep are subject to two certain mortgages formerly obtained
upon same, one by Herschel Carmichael, of Delphia, Montana,
mortgage securing a note in the amount of Six Thousand Five
Hundred Dollars ($6,500.00) and the other securing a note in
the amount of Ten Thousand Dollars ($10,000.00) given to Ray
Snider, the party of the second part herein, each of said
chattel mortgages running to the Regional
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