Spar Mountain Mining Co. v. Schwerin

• Decision Date: 15 February 1924
• Docket Number: 3330.
• Citation: 296 F. 678
• Parties: SPAR MOUNTAIN MINING CO. v. SCHWERIN.
• Court: U.S. Court of Appeals — Seventh Circuit

296 F. 678

SPAR MOUNTAIN MINING CO. v. SCHWERIN.

No. 3330.

United States Court of Appeals, Seventh Circuit.

February 15, 1924

Under contract between mining company and its manager, whereby he was to be paid certain commissions on ores mined and sold and a minimum of $10,000 per annum, the commissions to be determined on the 30th of June, 1921, and on the 31st of December, 1921, held, that commissions on ore produced in either of the two periods must be accredited when the ore is sold, to the period wherein it was produced, and that the manager is entitled to the commissions so accredited to that period, less what was paid him on his minimum guaranty for such period only.

Defendant company made a written contract with plaintiff, an experienced mining engineer, to act as general manager of its fluor spar mine, plaintiff's duties being the technical management of the mining operations and equipment of the property for the production of fluor spar, in such quantities as the company should deem advisable. The contract period was 18 months from July 1, 1920. It was provided that for his compensation plaintiff should be paid 'on all ores mined and sold a commission of (a sliding scale of from 50 cents to $2.20 per ton) when the price f.o.b. cars Shawneetown is (a corresponding sliding scale of from $12 to $44 per ton).' Sections 4 and 5 of the contract are:

Some time before the end of the first year the production of ore ceased through lack of demand for the product, and was not resumed until after the contract expired; but development work on the property continued under plaintiff's management until the end of the contract period, plaintiff being paid in monthly installments $5,000 for the last six-months period. The District Court held that the 5,000 tons of ore produced during the first year of the contract but sold at different times during the next period, or after the contract expired, were referable to the first year of the contract, and that the commissions thereon at contract rate should be added to the commissions for that year, regardless of when the sales took place, and judgment was given accordingly.

5. As and when this agreement terminates, by expiration, on December 31, 1921, or at the end of any renewal term, the agent shall be entitled to his balance of commissions, if any, in excess of said minimum guaranty, on any ores mined and hauled to the mill, of suitable quality for milling, but not then sold. Such commissions to be paid as and when the said ore is sold.'

Plaintiff was regularly paid his monthly installment of the $10,000 minimum guaranty. There was mined and delivered to the mill during the first year of the contract ore of suitable quality for milling aggregating 17,027 tons, of which 11,882 tons were sold during such first-year period, the portion then remaining unsold being about 5,000 tons, all of which was sold after July 1, 1921, most of it after December 31, when the contract terminated. At the end of the first-year period defendant paid plaintiff over and above the...