Walker v. Bruce

• Decision Date: 06 July 1908
• Citation: 44 Colo. 109,97 P. 250
• Parties: WALKER v. BRUCE.
• Court: Colorado Supreme Court

97 P. 250

44 Colo. 109

WALKER v. BRUCE.

Supreme Court of Colorado

July 6, 1908

Appeal from District Court, Chaffee County; M. S. Bailey, Judge.

Action by Gilbert A. Walker against H. T. Bruce. Judgment for defendant, and plaintiff appeals. Reversed and remanded, with directions to enter a decree for plaintiff.

G. K. Hartenstein, for appellant.

C. A Wilkin, for appellee.

BAILEY J.

This action was brought by the appellant to obtain a decree compelling the appellee to convey to the plaintiff an undivided one-half interest in the Harvest Moon mining claim. The plaintiff contended that the circumstances under which the property was conveyed to the defendant were such as would amount to a trust in favor of plaintiff. The circumstances as we gather them from the admissions, undisputed proof, and matters conclusively proven, are as follows: That on the 8th of September, A. D. 1903, Nelson Gaskill executed and delivered unto the plaintiff and defendant his lease of the property and bond for its conveyance upon the payment of $5,000 on or before the 15th day of November, 1903. The next day, in consideration of $25, Gaskill extended the option of purchase contained in such bond and lease until the 15th day of November, 1904. One-half of this $25 was paid by plaintiff and one-half by defendant. Under this bond and lease, the parties agreed to work the property jointly, each to bear one-half of the expense. This matter is disputed by appellee in his brief and also, to some extent, in his testimony, but the allegation of the complaint is 'that pursuant to said bond and lease, and in furtherance of their said enterprise the plaintiff and defendant immediately entered into the joint possession of the said mining claim and commenced the development of same, each bearing and to bear one-half of the expenses of such development work and one-half of all other expenses in the furtherance of their said enterprise.' In relation to this matter, the defendant in his answer says that he admits that, 'pursuant to said title bond and lease, he, the defendant, and the plaintiff, entered into possession of said Harvest Moon mining claim, and commenced work and did work upon the same, and that he, the defendant, and the plaintiff, were to share the expenses of said work and development work equally; that is to say, that he was to put in his own work and the plaintiff was to furnish a man to represent him, the plaintiff, in the doing of an amount of work equal to that that should be done by the defendant.' So we are constrained to believe that these people were engaged in a joint enterprise for the purpose of carrying out the provisions of the bond and lease, and were equal partners in that respect. The defendant strenuously urges that this did not amount to a partnership, but that plaintiff and defendant were simply tenants in common, each having his several interest, and that none of the elements of a mining partnership entered into the transaction. A mining partnership has been defined by this court as follows: 'A mining partnership is held to exist where the several owners of a mine co-operate in the working of the mine.' Charles v. Eschleman, 5 Colo. 111. 'A mining partnership may exist as well where the parties have an interest merely in the working of the mine or in carrying on mining operations as where they own the mine itself.' Manville v. Parks, 7 Colo. 128, 2 P. 212. In the same case it is said: 'For many years both English and American authorities have held that co-tenant owners, as well as lessees or parties having only equitable interests in the property, or holding under license to work or develop, or where the owner furnishes the mine, and another the capital and labor under an agreement to share the profits of the mine jointly, in all such cases there may be a partnership for mining purposes.' In Higgins v. Armstrong, 9 Colo. 38, 10 P. 232, it is said: 'The testimony, however, does not warrant the inference that it was an ordinary or commercial partnership, since no partnership organization was shown. It appears to have been an association of individuals for the purpose of prosecuting a certain business venture, which was the operating of mines and smelting works at Leadville. It may, therefore, be appropriately denominated a 'mining partnership,' since the business related to mining projects. It was held in Charles v. Eschleman, 5 Colo. 111, that a mining partnership exists where the several owners of a mine co-operate in the working of the mine. Here the several owners in the 'concern,' as Mr. Higgins calls it, co-operated in carrying on certain mining operations.' In Lyman v. Schwartz, 13 Colo.App. 318, 57 P. 735, it is said: 'It appears that the defendants were jointly engaged in working a mine, and that three of them agreed to contribute the money and the other his services, and that they were to share equally in the result if there was any result. This agreement shows a mining partnership.' In Meagher v. Reed, 14 Colo. 351, 24 P. 681, 9 L.R.A. 455, it is stated as a general rule that, when two or more persons acquire mining property solely or principally for the purpose of extracting the ore, the relation existing between them in the transaction of their common business is a mining partnership. From these rules, the allegations of the complaint, the admissions of the answer, and the undisputed facts appearing in the record, it is quite apparent that there was a mining partnership existing between the parties.

Shortly after the bond and lease was made, the parties commenced working the claim; the defendant himself working and the plaintiff employing a man to work in his stead. This arrangement continued until the 16th of the following December. Shortly after they became engaged in the enterprise, they conceived the idea of forming a corporation to take over the property and some other mining claims in which the plaintiff and defendant were jointly interested. The articles of incorporation were prepared by the plaintiff and were finally signed and acknowledged by the plaintiff and defendant and a third party on the 23d of October. The corporation was formed under the laws of Wyoming. Some time after the 23d of October--the exact date does not appear in the record--the articles were filed in the office of the Secretary of State of the state of Wyoming. About the 1st of October the defendant gave to the plaintiff $100, which the defendant testified was given for the purpose of enabling the plaintiff to purchase the claim from Gaskill outright. Plaintiff says that the $100 was given to him by defendant to be used in paying the expenses of the company. He says that the total disbursements were $328.10, of which the defendant contributed $100 and plaintiff the balance. On the 24th of October Gaskill went into the office of the plaintiff, and plaintiff then negotiated with him for the purchase of the mine, and finally bought it for $75 in cash and $25 to be taken in stock of the corporation which was then in process of formation. While the defendant alleges in his answer that he purchased the property from Gaskill, and while he testifies that he gave the $100 to the plaintiff for the purpose of purchasing the property, Gaskill says that the defendant never spoke to him concerning it, that the only talk he had with either of the parties in relation to the purchase of this property was the one he had with plaintiff at the time the sale was made. Plaintiff also testified that the money which he paid to Gaskill for the property was his own money, and did not belong to the company. As tending to support the theory of plaintiff,...