Willoburn Ranch Co. v. Yegen
| Decision Date | 11 April 1914 |
| Docket Number | 3370. |
| Citation | 140 P. 231,49 Mont. 101 |
| Parties | WILLOBURN RANCH CO. v. YEGEN ET AL. |
| Court | Montana Supreme Court |
Appeal from District Court, Yellowstone County; Geo. W. Pierson Judge.
Action by the Willoburn Ranch Company against Christian Yegen and Peter Yegen. From a judgment for plaintiff, defendants appeal. Affirmed.
F. B Reynolds, of Billings, for appellants.
M. J Lamb, of Billings, for respondent.
This cause was heretofore before this court on appeals from a judgment by default against the defendant Peter Yegen, and from an order denying a motion to set aside the default. Willoburn Ranch Co. v. Yegen, 45 Mont. 254, 122 P 915. The judgment and order were reversed on the ground that the complaint was insufficient, in that it did not set forth that the purpose for which the trust was created had been accomplished. The plaintiff thereupon filed an amended complaint to supply the omission suggested, and also to make more definite and specific the allegations showing the amount of money received and paid out by defendant Christian Yegen from rents and profits of the property in his hands, or from the proceeds of sales thereof, and what amounts had been advanced by him from his own funds.
The facts alleged in the amended complaint may be summarized as follows: On or about April 1, 1899, one G. W. Connick entered into a contract with E. G. Bailey, by the terms of which he agreed to purchase from Bailey a section of land in Yellowstone county, together with 90 shares of stock in the High Line Ditch Company, agreeing to pay therefor $7,680, as follows: $100 in cash upon the execution of the contract, and the balance in installments of $1,000, payable on April 1st of each year from 1901 to 1906, inclusive, and $1,580 on or before April 1, 1907, each of the installments to bear interest at the rate of 7 per cent. per annum. Bailey was required to deposit in escrow in the First National Bank of Billings a warranty deed conveying the land and stock to Connick when the purchase price should be fully paid. This Bailey did. The capital stock of the High Line Ditch Company was thereafter doubled, and the number of shares covered by the contract was thus increased to 192. On June 22, 1900, Connick subscribed for 128 shares of stock in the Big Ditch Company, agreeing to pay for it $10 per share, in payments to be made as follows: $256 in cash, and the balance in installments of $256 each, payable on December 22d of each year thereafter, from 1901 to 1904, inclusive. Each of these installments was to bear interest at the rate of 8 per cent. per annum. At that time all of the stock of this company was in the possession of the First National Bank of Billings, and held by it as security for moneys advanced to the Big Ditch Company under an arrangement by which each subscriber was to receive the shares subscribed for, upon full payment of the subscription price. On December 26, 1902, Connick, not being able to meet his payments as they came due under his contract with Bailey, or the installments due upon his subscription for the stock, made an agreement with Christian Yegen by which he transferred to Yegen his interest under the Bailey contract and in the stock of the Big Ditch Company, Yegen undertaking to meet the installments of the purchase price and stock subscriptions from time to time as they fell due. Connick was by the terms of this agreement to remain in possession of the land and cultivate it, but was to yield to Yegen the profits derived from it, to be used by the latter in reimbursing himself pro tanto for the funds advanced to discharge Connick's obligations. Upon such sums as were advanced by Yegen, he was to be allowed compound interest at the rate of 12 per cent. per annum until he had been fully repaid by Connick. This agreement covered also all the personal property on the land, including work stock, farming implements, etc. When Yegen had been fully repaid he was to convey to Connick all of the property remaining in his hands. When the agreement was made, Bailey substituted, in place of the deed theretofore deposited with the bank, another running to Yegen. On May 5, 1906, at the request of Connick, Yegen conveyed 320 acres of the land to Daniel Pratt and I. D. O'Donnell, together with 56 shares of stock in the Big Ditch Company, and 100 shares of stock in the High Line Ditch Company, for the sum of $14,400. All of this sum was retained by Yegen, and was used by him to carry out the purposes of the trust. The result of this transaction was that the amounts due from Connick upon his contract with Bailey, and upon his subscription for the stock of the Big Ditch Company, with interest thereon, was fully paid off and discharged by Yegen. The Bailey deed was delivered to Yegen, and also certificates for 72 shares of stock in the Big Ditch Company. On October 30, 1907, at Connick's request Yegen transferred to Robert Connick and others 140 acres of the land, together with 20 shares of the stock in the Big Ditch Company, and 46 shares of the stock in the High Line Ditch Company. On December 1, 1907, Connick sold and transferred to the plaintiff his entire interest in the property held by Yegen, with all his rights of action, etc., including his interest in the remaining shares of stock in the Big Ditch Company. At the time this transaction took place the plaintiff demanded an accounting by Yegen of the amounts received and disbursed by him, but failed to secure it until on or about September 14, 1908, when a partial settlement was had. Plaintiff then paid to Yegen $4,174.50. Thereupon Yegen conveyed to it all the residue of the property remaining in his hands, except the 20 shares of stock in the Big Ditch Company, which are the subject of this action. The total of the sums advanced by Yegen from 1903 to 1908, inclusive, amounted to $14,025.08. For compound interest on the various items making up this sum he was, under the terms of his agreement with Connick, allowed $5,043.67. It is alleged that on or about December 4, 1907, Yegen, without knowledge of G. W. Connick or the plaintiff, fraudulently assigned and delivered to his codefendant, Peter Yegen, the 20 shares of stock in the Big Ditch Company retained by him, without consideration; that Peter Yegen knew that this stock was a part of the trust estate belonging to Connick, and knew that Christian Yegen had no authority to transfer the same; that neither plaintiff nor Connick knew of the transfer until some time in the month of June, 1911; and that though repeated demands have been made by plaintiff upon both defendants for the transfer to it of the stock, they have failed and refused to comply. It is further alleged that the stock has at all times been of the value of $100 per share; that each share represents a statutory inch of water; that the defendants own land which can be irrigated by the water which the owner of the stock is entitled to use; that they have been using this water for the irrigation of their land since May 1, 1907; and that the reasonable value of the use of the stock so made by them has been and is $200 per year. Plaintiff prays for a decree declaring the defendants trustees for its benefit of the 20 shares of stock, that they be required to transfer it to the plaintiff, and that they be adjudged to pay to the plaintiff, by way of damages for the use of the stock, the sum of $200 per year from May 1, 1907.
The answer denies that the assignment and transfer was made by Connick to Yegen, as alleged in the complaint. It denies the allegations touching the subscription by Connick for the shares of stock in the Big Ditch Company, and the value of the use of it by defendants. It admits substantially all the other facts as alleged. It then alleges the following as special defenses: (1) That by the terms of the agreement by which Connick transferred to Christian Yegen his interest under the Bailey contract, he stipulated that he would repay to this defendant all sums of money advanced by the latter during the life of the agreement; that on or about October 30, 1907, being unable to meet his obligations in this behalf, Connick was in default; that in consideration of a waiver of this default by the defendant, it was agreed by Connick that this defendant should have the stock in question as and for his individual property, and that thereupon this defendant appropriated the stock to his own use and assigned it to his codefendant, Peter Yegen; (2) that on September 28 1908, defendant Christian Yegen conveyed to the plaintiff all the property acquired by him by transfer from Connick which still remained in his hands, except the 20 shares of stock in question, and that the plaintiff accepted the conveyance, and thereupon...
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