World Fair Mining Company v. Frank Powers

• Decision Date: 01 April 1912
• Docket Number: No. 207,207
• Citation: 224 U.S. 173,56 L.Ed. 717,32 S.Ct. 453
• Parties: WORLD'S FAIR MINING COMPANY, Plff. in Err., v. FRANK POWERS and Josephine Powers
• Court: U.S. Supreme Court

224 U.S. 173

32 S.Ct. 453

56 L.Ed. 717

WORLD'S FAIR MINING COMPANY, Plff. in Err.,

v FRANK POWERS and Josephine Powers.

No. 207.

Argued March 11 and 12, 1912.

Decided April 1, 1912.

Messrs. Frank H. Hereford and F. E. Curley for plaintiff in error.

[Argument of Counsel from pages 173-175 intentionally omitted] Mr. Eugene S. Ives for defendants in error.

Mr. Justice Holmes delivered the opinion of the court:

This is an action brought by the plaintiff in error upon a contract made by the defendants in error, hereafter called Powers, with one Ferguson, and assigned to the plaintiff in error. The contract was for the sale of some mines known as the World's Fair Group. Powers agreed to place a deed of the mines in escrow in the Arizona National Bank of Tucson within ninety days, to be delivered on performance of the undertakings on the other side. Ferguson was to begin work within ninety days, and to go on at a minimum rate until 1,000 feet had been done. All ore taken or stoped out below the main level, and all ores then on the dumps, were to be milled, concentrated, or leached on the grounds, $12 per ton being allowed to Ferguson for such treatment. On all ores, if any should be extracted, better adapted to be shipped directly to a smelter, and upon all concentrates, a further allowance to the extent of the shipping and smelting charges was to be made. Ferguson agreed to ship the products 'and after the deduction of the said shipping and smelter charges, to deposit in trust in the Arizona National Bank, Tucson, Arizona, the net proceeds therefrom, the same to remain in trust in said bank until the expiration of this agreement, which shall be upon the completion of the aforesaid 1,000 feet of work, or until such time' as Ferguson should pay Powers $450,000 and deliver to him one quarter of the full-paid stock of a company that Ferguson agreed to form for working the mines, the moneys deposited in trust thereupon to be Ferguson's. The agreement was to be void if Ferguson did not begin and prosecute the work in the manner and at the rate agreed upon, and in that event all permanent improvements were to belong to Powers.

By a subsequent modification of April 15, 1904, it was agreed that the money deposited in the Arizona National Bank should at once belong to and be at the disposal of Powers, and be credited upon the $450,000, the other party being released from further liability upon the amounts. On the same date deeds from Powers to Ferguson, and from Ferguson and the London & Glasgow Development Company, his assignee, to the World's Fair Mining Company, were placed in escrow by Powers and Ferguson in the Arizona National Bank, with instructions that upon demand by Powers in writing the bank should appoint a person to ascertain whether there had been a breach of agreement on the other side, and if he should certify other breaches or a failure to deposit the returns from ores, less the allowances, for more than fifteen days after the receipt of the returns, then Powers's deed was to be given back and the other deed destroyed. There were also provisions that, in case of performance, the bank should deliver the deeds. Before April 15, Ferguson and his assignee had been in possession and at work. Shortly after that date the World's Fair Mining Company went on with the business. On June 6, 1904, it received several thousand dollars proceeds from ores, and deposited them in the First National Bank of Nogales, to its own account. The money not having been deposited in the Arizona National Bank, and Powers being dissatisfied with the conduct of the plaintiff's predecessors, who also seem to have failed to deposit as agreed, on June 11 he brought suit and garnisheed the Nogales account. The...