Union Gold Mining Co. v. Rocky Mountain Nat. Bank

• Decision Date: 01 February 1872
• Citation: 1 Colo. 531
• Parties: UNION GOLD MINING CO. v. ROCKY MOUNTAIN NATIONAL BANK.
• Court: Colorado Supreme Court

1 Colo. 531

UNION GOLD MINING CO. v. ROCKY MOUNTAIN NATIONAL BANK.

Supreme Court of Colorado

February, 1872

A witness can not be asked whether he is indebted to one of the parties to the suit, for the purpose of showing the disposition of his mind toward such party.

Appeal from District Court, Jefferson County.

THE declaration contained a count for money loaned; a count for goods sold and delivered; a count for money had and received by defendant; a count for money paid, laid out and expended a count for interest, and a count on an account stated.

The defendant pleaded non assumpsit, and also specially that the plaintiff is a body corporate, with a capital of $50,000, and that, under and by virtue of a law of the United States entitled 'An act to provide national currency,' etc it had no power, right or authority to loan and advance to defendant the sum of money in the declaration mentioned.

In another special plea the defendant alleged that the plaintiff was a body corporate, organized under the act entitled 'An act to provide a national currency,' etc., reciting the provisions of the act, and averring 'that certain persons did, at the time specified, form an association, with a capital stock of $50,000,' which was the plaintiff, and that the plaintiff had no power, authority or right to loan and advance to defendant the sum of money in the declaration mentioned.

In another plea the defendant averred that the plaintiff was a body corporate, etc., and had no right, power or authority to loan or advance to defendant a greater sum than $5,000. Another plea was substantially the same, except that it averred that only $30,000 of the plaintiff's capital stock had been paid in. A demurrer to the special pleas was sustained.

The testimony at the trial was voluminous. Plaintiff introduced evidence tending to prove that George K. Sabin was appointed superintendent of the defendant's mine, in the year 1865; that he remained such superintendent until December, 1868; that, during the years 1867 and 1868, Sabin kept a deposit account with plaintiff in defendant's name, and that he drew money from time to time in the name of defendant, and deposited other money to the credit of the account; that the balance against defendant in December, 1868, was $21,217.06; that Sabin worked defendant's mine in the years 1867 and 1868, taking there from a large quantity of valuable gold-bearing ore, and crushing a portion thereof for the purpose of obtaining gold; that the gold thus obtained was deposited in plaintiff's bank to the credit of defendant; that the money obtained by Sabin from plaintiff's bank was expended in operating the mine and in crushing the ore. Several letters were introduced by plaintiff, which were written by Becker, the president of defendant, some of which were addressed to Sabin as superintendent. One of the letters was signed by Becker as president.

There was evidence of several interviews between Becker and the officers of the bank, in relation to the indebtedness, in December, 1868. A communication from Becker, to the president of the bank, which was given in evidence, is as follows:

ROCKY MOUNTAIN NATIONAL BANK, CENTRAL CITY, COLORADO, Jan. 1, 1869.

To the President of the Rocky Mountain National Bank:

SIR-In regard to the overdraft of our company on your bank, permit me to say that, although I am the president of the Union Gold Mining Co., and the owner of a majority of all its stock, Mr. Sabin will do me the justice to state that I had no knowledge of any overdraft, until on or about the middle of December last. I hope you will not feel uneasy about the payment. We have an abundance of ore already broken in the mine, to pay all indebtedness of the company. In fact, this is the only indebtedness I have any knowledge of the company owing, and if it is not paid off out of the mine, I propose to call a meeting of our directors, and submit your claim, and make an assessment at our February meeting (in New York city), to pay off your claim, and any other that the company may owe. I will also state to you clearly and plainly, that there shall be no sale, transfers, mortgages, assignments, deeds of trust, or any other incumbrance put on the property of company in Colorado, or elsewhere, by myself, or by the company, until all the liabilities of the said company are fully paid.

Very respectfully,

Your obedient servant,

THEODORE H. BECKER.

On cross-examination of the witness, Sabin, the defendant offered to show by him that hew as indebted to plaintiff in a large sum of money, and that, at a previous term of the district court, he absented himself from the court, and that, when he appeared as a witness, he refused to testify till the indebtedness was arranged in some way, and such arrangement put into writing and signed by the plaintiff, and that, since the last term of court, the said matter of indebtedness had been arranged according to the terms required by the witness.

Upon the plaintiff's objection, the testimony was excluded.

The defendant introduced testimony tending to prove that Sabin resigned his agency in April, 1866, and that in the fall of that year he made an arrangement with the defendant, by which he was to work the mine upon his own account, and lay up the first-class ore for the company for the use of the mine.

T. H. Becker testified: That, on the 16th of December, 1868, he wrote the company of the indebtedness to the bank, and that was the first knowledge the company had of the indebtedness.

The defendant offered to prove by Mr. Becker, the nature of his authority from the defendant in respect to the indebtedness due the plaintiff. Upon plaintiff's objection this evidence was rejected.

The charge of the court to the jury was as follows:

If the jury believe that George K. Sabin entered into an arrangement or agreement with the defendant, whereby he was to enter into possession and work the mines of the defendant, at his own expense, and not at the expense of the defendant, and pay to the defendant a certain portion of the ore taken from the mines for the use of the mines, and pay himself and all the expenses of working the mines from the balance of the ore taken from the mines, and that, under the arrangement so made with the defendant, the said Sabin entered into and worked the mines of the defendant; then, the relation existing between the said Sabin and the defendant was not that of principal and agent, but that of landlord and tenant, and is governed by the same law as in case of working land for a share of the crops. And the said Sabin became the lessee of the defendant, and the said defendant is in no way liable for any sum of money borrowed by the said Sabin, and cannot be made liable without a special promise in writing, made and signed by the defendant. That a corporation is bound by the contracts and acts of its agent, so far as the agent acts within the scope of the authority conferred upon him by the corporation, but not further.

If the jury believe, from the evidence, that George K. Sabin made an agreement or arrangement with the defendant, whereby he was to enter into the mines of defendant and work the same on his own account, and was to mine and deliver to the defendant, on the top of the ground, all the first-class or smelting ore, as rental or tribute for the use of the mines of the defendant, and was to receive no salary from the defendant for his services, but was to pay himself and all expenses of working the mine from the proceeds of the balance of the ore mined from said mines, and that the defendant was not to furnish any money for the working of said mines, and that Sabin was to contract no debts chargeable to the defendant, but was to quit work on said mines whenever he could not pay all expenses and pay himself from the lower grades of ore, then the jury must find for the defendant in this case.

If the jury believe, from the evidence, that Becker was president and general manager of the defendant in 1868 and 1869, and that the defendant had, by George K. Sabin, claiming to be the superintendent or agent of defendant, obtained money of the plaintiff, and that Becker, while acting as president of defendant, with full knowledge of the facts, admitted that such money so obtained was due from the defendant to plaintiff, such admission may be taken by the jury in considering whether the defendant is or is not indebted to the plaintiff.

If the jury believe, from the evidence, that the defendant employed George K. Sabin as its superintendent, in April, A. D. 1865, and that instructions were, at that time, sent in a letter to said Sabin by the president of the defendant, and that Sabin, under said appointment, proceeded to work the mine and mill of the defendant in Central City, where the plaintiff is located, and to make contracts for the defendant from the fall of 1865 until the spring or summer of 1866, and then stopped working until the fall of 1866, and then resumed said work, and continued said work until December, 1868; and that, during the time from the fall of 1866 until December, 1868, George K. Sabin contracted the debt sued for in this case on behalf of the defendant, and used the money received from the plaintiff in working defendant's mine, and for the defendant, and the defendant received the benefits of the work, knowing that the money had been so applied, then the plaintiff is entitled to recover, unless the defendant has shown that the plaintiff had notice of the change of his agency as sworn to by witnesses Becker, Potts, Bennell, Jr., and Brevoort, in this case.

The court is asked to instruct the jury that the plaintiff is not compelled to prove the appointment of Sabin as superintendent or agent of defendant, by...