Whittaker v. Otto

• Citation: 56 Cal.Rptr. 836,248 Cal.App.2d 666
• Court: California Court of Appeals
• Decision Date: 20 February 1967
• Parties: Norman A. WHITTAKER, Plaintiff and Appellant, v. Mae F. OTTO et al., Defendants and Respondents. Civ. 8079.

Page 836

56 Cal.Rptr. 836

248 Cal.App.2d 666

Norman A. WHITTAKER, Plaintiff and Appellant, v. Mae F. OTTO et al., Defendants and Respondents.

Civ. 8079.

Court of Appeal, Fourth District, Division 2, California.

Feb. 20, 1967.

As Corrected March 21, 1967.

Hearing Denied April 19, 1967.

[248 Cal.App.2d 667] Forslund & Wilson, and Douglas E. Wilson, Stockton, for plaintiff and appellant.

Overton, Lyman & Prince, and Laurence J. Larson, Los Angeles, for defendants and respondents, August Chopp, John Descher, Raymond Descher, Mae Bass King, Executrix of Estate of Clarence R. King, deceased, individually and as members of a joint venture known as Jarco Mining Co., and Jarco Mining, Inc., a California corporation.

Wallace K. Downey, Los Angeles, for defendant and respondent, California Portland Cement Co.

OPINION

McCABE, Presiding Justice.

Action for general and punitive damages for trespass upon a mining claim and conversion of a quantity of iron ore. From an adverse judgment of the Superior Court in and for the County of Inyo, plaintiff prosecutes this appeal. The attempted appeal from the order denying a motion for a new trial should be dismissed as being from a non-appealable.

The mining claims which are the subject of the present controversy lie some seventeen or eighteen miles north of Trona in the Argus Mountains near the Panamint Valley, Inyo County, California. They were originally patented in 1911, and recorded January 12, 1912, from the United States to The Iron Cap Copper Mining Company, a corporation; that company was incorporated in Wyoming but forfeited its right to do business in California in November 1912. The major stockholder of that corporation and the then sole surviving director, Percy Hagerman (hereinafter Hagerman) deeded the claims to himself as Trustee in 1944 'as sole surviving director of The Iron Cap Copper Mining Company, a defunct corporation.'

Commencing in the year 1946, one Merle F. Otto was employed as caretaker upon the property. He paid the annual real property taxes assessed thereon, claiming reimbursement from the son of Hagerman who had undertaken to manage his father's affairs. Merle F. Otto (hereinafter Otto) was in possession of the claim throughout this period and had placed signs on the claim which read 'Merle F. Otto, Agent for Owner.' At sometime during 1958 these posted signs were changed to read 'Merle F. Otto, Owner' and on or about April 7, 1958, Otto executed a deed to the claims to himself as grantee.

Hagerman's son, Lowry Hagerman, on or prior to November 25, 1958, gave an option to lease these mining claims (hereinafter called the Monarch Claims) to the plaintiff, Norman A. Whittaker. This option was approved by the Superior Court in and for the County of Inyo on November 25, 1958, and the order approving the option was recorded at plaintiff's request in the official records of said county on December 15, 1958. Plaintiff, exercising this option, was named as lessee under an Iron Ore and Mineral Mining Lease covering the Monarch Claims made and executed by Lowry Hagerman on January 21, 1959.

During the interim, however, Merle F. Otto and his wife, Mae F. Otto, had executed a purported lease covering the Monarch claims in favor of one August Chopp, a defendant herein. This lease was not recorded until September 11, 1959.

Defendant Chopp in turn contacted the present codefendants John Descher, Raymond Descher and Clarence R. King, ¹ who agreed to enter into an association to mine the Monarch claims in December 1958. This association, found by the trial court to be a joint venture, did business as Jarco Mining Co. Subsequently this association was incorporated in California as Jarco Mining, Inc. and in July 1959 the leasehold interest of August Chopp was assigned to the newly formed corporation. The defendants in the joint venture, the Jarco Mining Co. and Jarco Mining, Inc., are hereinafter referred to as the Jarco group.

On February 2, 1959, plaintiff filed an action in ejectment against Merle F. Otto and various Does in Inyo County. A lis pendens was recorded on the Monarch claims on February 5, 1959. Thereafter a judgment in favor of plaintiff Whittaker that he recover possession of the Monarch claims and the iron ore and other minerals situate thereon as against Otto was entered on April 24, 1960. Among the issues raised by Otto in that action by the pleadings and otherwise was 'whether or not plaintiff has a valid leasehold or other interest in the mining claims which are the subject of the action.' In raising this question, Otto attacked by pleading and in court the legal title and authority of Whittaker's lessor to execute a lease in Whittaker's favor. The trial court in that action found Whittaker was a lessee and concluded his lessor was in possession of the premises and had been at all times entitled to possession of the Monarch claims as against the parties to that action. Otto prosecuted an appeal to this court which affirmed the judgment in the ejectment action and that judgment has long been final. (Whittaker v. Otto, 188 Cal.App.2d 619, 10 Cal.Rptr. 689.)

The individual defendants comprising the Jarco group were admittedly aware of Whittaker's claim of right to possession of the Monarch claims in early 1958. In fact, several of them attended the trial of the matter before the court in Inyo County. Additionally, defendant Chopp previously had personally checked the status of the recorded title in the official records of Inyo County and had ascertained title was in the Hagerman Estate and was not in Otto, his lessor. The members of the Jarco group, concerned with their legal status in possession of the Monarch claims, consulted an attorney in Independence, one Smith, who was also counsel of record for Otto in the ejectment action, concerning their right to mine the iron ore on the Monarch claims on or about January 28, 1959. Entries in defendant King's diray on the date of that meeting with Smith, introduced in evidence in this action, indicated they were told:

'1. Nobody has title clear.

'2. Otto has best chance if continuous possession. ²

'3. Thinks can win if somebody else contests Otto.'

The ore deposit was marked by surface outcrop of ore with the major portion of the ore body covered by dirt and other geological debris. The Jarco group initially attempted to do some preparatory work on the site to prepare it for open-face mining, but finding the task beyond their limited equipment and labor resources, they employed one William V. Skinner, doing business as Brownstone Mining Company, to prepare the site and mine the ore for them. This work was commenced by Skinner and his men in the week of October 9 to 16, 1959. In preparing to remove the ore, Jarco and Skinner built several roads to the outcrop of ore and built three mining benches, ³ which constructed changes lay across the top of the major portion of the ore body. Some 5038.3 tons of ore were removed from the Monarch claims during the months of October, November and December 1959. The ore removed was sold by the Jarco group under a contract to codefendant California Portland Cement at $7.25 per ton for a total of $36,527.00. The contract under which California Portland Cement purchased this ore had been signed on September 9, 1959.

Plaintiff Whittaker had previously contracted California Portland Cement by letter dated April 23, 1959. In this letter he attempted to interest this concern in a limestone deposit he owned Some ten miles to the north of Monarch Iron Cap, but he mentioned during the course of the letter that he owned an iron mine 'about 11 miles to the south.' A geologist with California Portland, one J. E. Joyce, responded to his letter on May 5, 1959, expressing his company's interest in the iron deposit 11 miles south of the limestone. On July 8, 1959, Whittaker wrote to Joyce, 'The one referred to in my letter is 17 miles north of Trona. This is quite a large high grade iron deposit. The iron is chiefly hematite, running about 30% Magnetite. But it is very dense and heavy. It runs an average of 67% Fe (Iron) and under 4% Silica; other impurities are nil such as phos, sulphur, titanium, copper and arsenic.' He then stated the property was available for purchase or he would mine it under contract. Joyce responded once more on July 15, 1959, expressing further interest.

Prior to this time Joyce had investigated a large iron deposit referred to him on December 1, 1958, which was purportedly 14 miles north of Trona and purportedly owned by one Gus Chapp, (August Chopp--one of the codefendants herein). On December 17, 1958, he wrote to this defendant asking to visit the property. In company with Chapp (August Chopp) he visited the property on December 28, 1958, and obtained a large sample for analysis. This sample analyzed as containing by weight from 64 to 95% Fe2O3 (ferric oxide) or from 46 to 67% Iron by weight. In a memorandum written to a purchasing agent on January 26, 1959, he noted the property was 18.4 miles north of Trona (from the railroad loading platform in Trona) and was known as Monarch (4 patented claims) and Iron King (4 unpatented claims). In the same communication he noted the claim had been worked previously and indicated he was previously aware of the deposit. At that time defendant California Portland never inquired as to the ownership of the ore it purchased. Since filing of this suit, and admittedly as the causative factor, it now makes this inquiry of the claims from which it purchased the ore.

After the judgment in the ejectment action was affirmed on appeal, plaintiff obtained a writ of possession on the Monarch claims on April 25, 1960, and according to the affidavit of service, it was personally served on Raymond Descher and Otto on May 11, 1960. About January 8, 1960, however, Jarco fulfilled its initial contract with defendant California Portland. Due to Jarco Mining's uncertain title to the ore, California Portland, upon...