Wheeler v. Mineral Farm Consol. Min. Co.

Decision Date12 January 1903
Citation71 P. 1101,31 Colo. 110
PartiesWHEELER v. MINERAL FARM CONSOL. MIN. CO.
CourtColorado Supreme Court

Error to District Court, Pitkin, County.

Action by the Mineral Farm Consolidated Mining Company against B Clark Wheeler. From a judgment in favor of plaintiff defendant brings error. Affirmed.

H. L. McNair, for defendant in error.

William O'Brien, for defendant in error.

PER CURIAM.

This is an action for an accounting by the Mineral Farm Consolidated Mining Company against B. Clark Wheeler and the Continental Divide Mining Investment Company and the Famous Mining Tunnel & Improvement Company. Three mining companies were doing business in Pitkin county, Colo.--the Pontiac Mining Company the St. Joe & Mineral Farm Consolidated Mining Company, and the Champion--Empire Mining Company. The first was organized in 1890, the second in 1891, the third in 1892. For convenience they are hereinafter referred to as the 'Pontiac,' 'St. Joe,' and 'Champion' Companies. For several years the defendant, B. Clark Wheeler was the owner of a large majority of their capital stock, and was either manager or president, or both, of all three corporations, and the board of directors of each was named and controlled by him, and acted as he directed. He lost such control in the latter part of the year 1894, and his successors organized the plaintiff mining company, under which name the three last-named corporations were consolidated under the laws of this state relating thereto, and all the property and rights of action belonging to these companies were merged in and became the property of the plaintiff company.

This action was brought in February, 1895. After the issues were made, the trial court sent the cause to a referee, who proceeded to take testimony, and upon the incoming of his report, after a full hearing before the court, all of the issues were found in favor of the plaintiff and against the defendant, B. Clark Wheeler, and judgment upon the findings was entered against him in a sum aggregating $45,551.50. This was upon three separate causes of action or items of account that arose out of certain transactions between Mr. Wheeler the defendant companies, and these constituent corporations, whereby Wheeler became indebted to the latter in large sums of money. The pleadings are lengthy, and the evidence voluminous. Controversy over the third item in favor of the St. Joe Company, the one to which most of the evidence was directed, no longer exists, for the plaintiff in error, though protesting that the action of the court concerning it was erroneous, nevertheless, because of his anticipated difficulty in setting aside findings of fact which relate to so many transactions, has concluded on this review to abandon it. That leaves for our consideration the errors assigned to the findings and judgment of the court with reference to Wheeler's transaction with the Pontiac and Champion Companies. These are best considered separately. No important questions of law are involved. If the judgment of the lower court is sustained by the evidence, this writ of error, prosecuted to reverse it, must be dismissed.

1. The ground of complaint against Wheeler in his dealings with the Pontiac Company, as stated in the pleadings, is that he received from that corporation 198,109 shares of its treasury stock in pursuance of an agreement between them by which he was to pay therefor for at the rate of 15 cents per share, and the payments were to be made as fast as money was required by the company to pay for development work it was doing upon its mining claims; and in pursuance of the agreement, and as evidence of its terms, Wheeler caused to be executed in the name of the defendant the Continental Company, by himself as president and A. J. Peck as secretary, a promissory note for the sum of $29,836.35, payable to the Pontiac Company, in consideration for the delivery to him by it of the stock. Upon this obligation some payments, the exact amount of which is unknown to the plaintiff, were from time to time made by Wheeler. The note was executed by Wheeler, as it is alleged, in the name of the Continental Company, for the express purpose of concealing the fact that he, who was the president and director and general manager of the Pontiac Company, was selling to himself...

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