Swan v. Davenport

• Decision Date: 20 January 1903
• Citation: 93 N.W. 65,119 Iowa 46
• Parties: G. W. SWAN, Appellant, v. W. J. DAVENPORT et al, Appellees
• Court: Iowa Supreme Court

93 N.W. 65

119 Iowa 46

G. W. SWAN, Appellant, v. W. J. DAVENPORT et al, Appellees

Supreme Court of Iowa, Des Moines

January 20, 1903

Appeal from Union District Court.--HON. W. H. TEDFORD, Judge.

ACTION in equity for an accounting. The opinion states the facts. There was a decree dismissing the petition, and judgment against plaintiff for costs, and he appeals.

Affirmed.

James G. Bull and Stuart & Stuart for appellant.

Maxwell & Winter and D. W. Higbee for appellees.

OPINION

BISHOP, C. J.

It appears that prior to October, 1896, one G. W. Bilbo had acquired an interest in a tract of mineral land in the state of Colorado, supposed to contain gold ore. Such interest consisted of a lease and bond granting the right to develop and operate the supposed gold mine during the term fixed, and to take and appropriate all gold and other minerals found therein. Not having funds to prosecute the work of development and operation, Bilbo conceived the plan of organizing a voluntary unincorporated association to take up and carry forward such work. Accordingly, and on October 1 1896, a written instrument, called a "trust agreement," was drawn up, in which it is provided, in substance, that Bilbo shall hold title to the property as trustee for the benefit of himself and all others who shall join the association; that certificates of shares, limited to thirty in number, shall be issued to the members joining in the enterprise, each certificate to represent an undivided one-thirtieth interest in the property; that each shareholder shall pay the sum of $ 10 on the 1st day of each and every month until ruled otherwise by a majority vote of the certificate holders, which moneys shall be used in payment of development expenses, etc. The agreement further expressly authorizes the trustee to sell any share on which any monthly payment shall not have been made; such sale to take place on the 10th day of the month following the failure to pay, and for the highest and best price he can obtain on said day. The certificate holders are authorized, in express terms to sell or assign their respective shares. The certificates issued also in terms authorize the sale thereof by the trustee in case of failure to make payments as provided in the agreement. The plaintiff and the defendants other than the Creston Gold Mining Company, became shareholders in the enterprise. It further appears that during the time development work at the mine was in progress the said Bilbo resigned as trustee, and the defendant Davenport was appointed in his stead, and went out to the mine and took active control of the work.

This controversy has reference solely to the subsequent ownership of the interest represented by the share certificate originally issued to the appellant Swan, and the question involved is largely one of fact. We shall content ourselves with a statement of the ultimate facts as we find them to be from our reading of the record. Swan made monthly payments on his share to the...