108 Cal. 369 | Cal. | 1895
Lead Opinion
The Hale & Norcross Silver Mining Company is a corporation, organized under the laws of California, with its principal place of business at the city of San Francisco. It is the owner of one of the mining claims on the Comstock lode, in the state of Nevada, where for many years it has been' engaged in the business of mining gold and silver bearing ores.
The plaintiff, M. W. Fox, since the year 1887, has been at all times a stockholder of said corporation. In August and September, 1890, he addressed communications to its board of directors, and to the individual members of the board, charging, in substance, that for three years the corporation and its stockholders had been systematically plundered, and its property stolen, to the amount of more than $2,000,000, by means of a fraudulent conspiracy and combination between said directors and the owners or lessees of the mills employed in the reduction of the ores extracted from the company’s mine; that the devices resorted to in furtherance of the object of this conspiracy were the mixture of worthless rock with high-grade ores so as to obscure their value, and at the same time increase the quantity of material to be put through the mills; the concealment from the stockholders of the average value of the ores, as thus reduced; a fraudulent system of milling by which only a small portion of the precious metals contained in the ores was returned to the company; and a disposition of the stolen bullion in a manner intended to conceal the theft. He further stated in his communication to the board that he was prepared to furnish sufficient evidence of the truth of his charges, and demanded that the directors should institute an action in the proper court, in the name of the company,
Nothing having been done by the directors in response to this demand, the plaintiff commenced this action, in which he joined as defendants the corporation, all the individuals who had served as its directors from 1887 to 1890 inclusive, and the owners of the several mills in which its ores had been reduced during the same period — these last being sued by fictitious names. The summons does not appear to have been served on any of the mill-owners, but the other defendants filed their answer to an amended complaint, and on the issues so made the cause was brought to trial November 18,189 L. During the progress of the trial the complaint was further amended by the insertion of the true names of the mill-owners sued by fictitious names, and by the addition of some new allegations; and on March 6, 1892, at the close of the trial, a final amended complaint was filed, for the purpose, as stated, of conforming the pleadings to the proofs.
All the material allegations of these amended complaints were either denied by the answers of the several defendants, or were by the court treated as denied. On June 11, 1893, the superior court filed its findings and conclusions, and entered its decree in favor of the plaintiff for the benefit of the corporation defendant, and against the other defendants (except Hobart, a mill-owner, who had died on June 2d, and as to whose estate all proceedings were continued) severally for various sums. As against Hayward and the Nevada Mill & Mining Company (a corporation)—mill-owners—and Levy, who had been president of the Hale & Norcross company during the whole period from 1887 to 1890 inclusive, there were several judgments for the entire amount of the company’s losses, estimated at $1,011,-835. As against the other defendants—directors of the corporation—there were several judgments in smaller and varying amounts, corresponding, as it is claimed, to the losses sustained by the corporation during their
Execution was directed to issue upon these judgments, but it was provided that no more should be collected thereon than said sum of $1,011,835, with accruing interest and costs. And a receiver was appointed, to whom the amount so collected was to be paid, and who was authorized and directed by the judgment to pay over to the attorneys for the plaintiff—as compensation for their services—25 per cent of all sums collected. In due time all of the defendants against whom judgment had been rendered moved for a new trial upon a settled statement of the case, and, their motion having been denied, they have taken this appeal from said order and from the judgment.
The large amount involved in the controversy, the difficulties presented by the subjects of investigation, the great length of the trial, the immense mass of evidence, consisting largely of closely printed columns of figures, and the ability, industry, and ingenuity of counsel have combined to raise an unusual number of difficult questions for our decision, in the discussion of which it will be necessary to state in considerable detail many of the matters contained in the record. It will be more convenient to make a particular statement of these matters in connection with the several assignments of error to which they relate, but it will facilitate the discussion to state at the outset the general nature of the issues presented by the pleadings, and the facts as found by the superior court.
In his last amended complaint, filed" as above stated, after the evidence was all in, and for the declared purpose of conforming the pleadings to the proofs, the plaintiff alleges, among other things: That between the 1st of January, 1887, and the 1st of July, 1890, the Hale & Norcross Silver Mining Company delivered to the Chollar or Nevada mill, and to the Vivian and Mexican mills, at or near Virginia City, in the state of Nevada, not less than 80,000 tons of gold and silver bearing ore,
That said directors, in furtherance of the conspiracy, ordered and permitted all of said ores to be milled at said Mexican, Vivian, and Chollar or Nevada mills, at the exorbitant and excessive rate of $7 per ton, $3.50 per ton being a fair and reasonable price—to the damage of
That about 6,000 tons of ore were delivered to the Virginia & Truckee Railway Company, to be transported to the Chollar mill, which were never accounted for, causing a further loss to the company and its stockholders of $480,000.
That the aggregate losses occasioned by these various acts of the conspirators amounted to $2,100,000, a large portion of which has been divided up and distributed to the directors of the mining company.
The defendants were not permitted to file any answer to this last amended complaint, but their answers to the second amended complaint were allowed to stand as. answers to the last amended complaint, and, so far as its allegations were new or different from previous allegations, they seem to have been treated as if they were in issue, and I shall assume that they were so treated. The answer of the corporation and its directors admits the delivery of its ores to the mills named in the complaint, for the purpose of milling and reduction, and the answers of the mill-owners admit the receipt of said ores, but it is denied that they were of the value alleged, or of any greater value than $1,879,094.68, less the cost of transportation and reduction. Aside from these admissions, it may be said with substantial accuracy that every material allegation of the complaint is put in issue. Hayward and Hobart deny that they were owners or lessees of, or engaged in operating, any of the mills named in the complaint. The Nevada Mill & Mining Company, of which they were stockholders, admits that it owned and operated the Chollar or Nevada mill, and received and worked a portion of the Hale & Norcross ores.
Upon these issues the findings of the superior court were generally in favor of the plaintiff, and I shall merely note, in this connection, some of the more important particulars in which they were otherwise.
It was found that Hayward, Hobart, the Nevada Mill
It is not found that all or any part of the fruits of the conspiracy came to the hands of Hayward or Hobart, otherwise than by the general findings to the effect that they were received by the whole body of the conspirators.
There is no finding as to what was the reasonable price of milling Comstock ores during the years 1887-90. It is found that the actual cost of milling the ores in controversy was $4.50 per ton and no more, and that the charge made and allowed of $7 per ton was fraudulent, exorbitant, and excessive to the extent of $2.50 per ton. But it is conceded that this is not a finding of what an honest miller, entitled to a reasonable compensation for the use of his mill, might properly have charged. It is a finding only of the actual cost of reduction, without allowing any thing for the use of the mills, the court being of opinion that these mill-owners, participants as they were found to be in a conspiracy to defraud the mine-owners, were entitled to no compensation for the use of their mills.
It is not found that any ores delivered to the railway company for transportation to the Nevada mill were unaccounted for, but, on the contrary-, it is expressly found that all such ores were accounted for.
It is not found that the mine or car sample assays were used by the defendants as a basis for the division of profits, or that any profits were divided, but, in general terms, it is found that all the defendants, including the directors of the Hale & Norcross company, re
In some particulars the findings go beyond the allegations of the complaint. It is not alleged, but is found, that Hayward, Hobart, and the other conspirators controlled and directed the business and affairs of the Vivian mill, as well as of the Nevada and Mexican mills. It is not alleged, but is found, that the defendant Levy was president of the board of directors of the Hale & Norcross company during the whole period from 1887 to 1890, inclusive.
The quantity of ore alleged to have been delivered at the mills for reduction was not less than 80,000 tons, and its value is alleged to have been not less than $3,250,000. It was found that 88,887 tons were delivered, of the value of $3,505,361.
The defendants, in support of their appeal from the judgments, contend that they are erroneous in form and substance; and, in support of their appeal from the order denying a new trial, contend that the findings of the superior court are against the evidence, and are vitiated by numerous errors committed in the course of the trial in ruling upon objections to the evidence, and upon other matters.
The most important questions which we are thus called upon to determine relate to certain legal propo- • sitions, as to which our decision must become a precedent in future controversies; but the questions which have been most elaborately discussed by counsel, and which go most directly to the merits of this case, relate to the sufficiency of the evidence to sustain the findings of the superior court, and these I shall consider first.
It is contended that there is no evidence to support the findings as to the alleged conspiracy to defraud the Hale & Norcross company. So far- as the defendants Hayward and the other mill-owners are concerned, it does not seem to be of much consequence whether these findings can be sustained in their full extent or not,
' The evidence upon this point which most nearly affects the directors of the corporation is that which relates to their election. It seems that in 1887, and for some time prior thereto, the bulk of the Hale & Nor-cross stock was in the hands and under the control of certain stockbrokers in San Francisco. On the books of the company it stood in the names of trustees of these brokers, but, according to their theory, it was the property of their customers. The evidence in this record as to the exact relations between broker and customer is not very explicit, but what they really were is a matter of common knowledge, with which this court has been made especially familiar by a series of cases recently decided here, involving a construction of the constitutional provisions against sales on margin. (Cashman v. Root, 89 Cal. 373; 23 Am. St. Rep. 482; Wetmore v. Barrett, 103 Cal. 246; Sheehy v. Shinn, 103 Cal. 325; Baldwin v. Zadig, 104 Cal. 594; Kullman v. Simmens, 104 Cal. 595.) I conclude, therefore, that this Hale & Norcross stock was held as mining stocks were at that time generally held by the San Francisco brokers. It had been purchased on orders from dealers and speculators upon deposit of the customary margin, and bad been transferred to the trustees of the brokers as security for their advances. It was, in other words, according to the theory of the broker’s contract, a pledge, but, according to the constitution, it was the property of the broker, and the subject of an unlawful and void contract of sale. It is not necessary, in my opinion, to decide who, under these circumstances, had the strict, legal right to vote the stock so held. Conceding that the brokers could lawfully vote it at the annual elections of the directors of the corporation, they were, nevertheless, hound to vote it in the interest of those for whom they
For these reasons I think it must be held that the. finding as to the directors other than Levy, that they were participants in the frauds alleged, is not sustained, except so far as they were made participants by a culpable negligence which enabled others to consummate such frauds. This, indeed, seems to be conceded by counsel for respondent in their argument upon Mr. Wheeler’s appeal, in which they contend that the judgment against him is fully sustained by the proof of negligence—a point to be considered hereafter.
It is next contended that the evidence does not sustain the finding that Levy, with others, controlled the Nevada mill. I do not think this point merits discussion, for the reason that the finding is immaterial. It harms no one else, and does not affect the liability of Levy one way or the other.
The next finding attacked is that in which it is found that Hayward, Hobart, and the Nevada Mill & Mining Company controlled and managed the Mexican mill. The evidence on this point is conflicting, and I think the fact—clearly proved—that Hayward and Hobart paid to Levy his one-eighth share of the profits on the crushing of the Mexican mill, in the same manner and at the same time that they paid him on account of the crushing at the Nevada mill, is sufficient to sustain the finding as to them. Their payments, however, are not evidence against the mill company, and I cannot see that there is any evidence to sustain the finding as against it.
It is next claimed that there -is no evidence to sustain the finding that Hayward, Hobart, and the Nevada Mill & Mining Company controlled and operated the Vivian Mill, and this contention, I think, must be sustained. The position of respondents’s counsel with respect to this point may be best shown by quoting their entire argument. They say: “The arrangement with Levy, which was made before any of the ores of
It will be observed that there is no reference here to any page or folio of the record, and I can only say that, after a very careful reading of the whole of it, I have failed to find anything to sustain the assertions of counsel. The only arrangement with Levy of which there was any evidence was, not that he should have a share of the profits of milling all ores of the Hale & Nor-cross mine, without regard to where they were milled, but only that he should have one-eighth of the profits on any ore milled by Hayward, Hobart, and the parties represented by them, including the Nevada Mill & Mining Company. There is no evidence that the entire business of milling the ores was turned over to Hayward, Hobart, and the mill company, or that they had complete control of the affairs of the mining company, so far as the milling of its ores was concerned; and it is not only claimed, but conceded, that the Vivian mill, with which the defendants are not shown to- have had any connection, milled nearly 5,000 tons of the ore. It does appear that, owing to the merely passive attitude of a majority of the board of directors of the Hale & Norcross company, the actual control of all its affairs was in the hands of Levy, the president of the board, and it is obviously true that it was to his
It is next contended that the finding to the effect that Hayward, Hobart, and the Nevada Mill & Mining Company, in conjunction with the other defendants, controlled all the business affairs of the Hale & Nor-cross company is against the evidence. This finding is material only so far as it relates to the mining and milling of the Hale & Norcross ores, and as to those matters the evidence fully warrants the conclusion that a majority of the directors were, as above stated, simply acquiescent or passive, and that Levy did as he pleased. Whatever inference, therefore, as to participation by the mill-owners in the control of the mining company may be legitimately drawn from the existence of the unlawful contract for a division of the profits of the milling, or from the manner in which the ore was milled, or from any inadequacy of returns of bullion, or neglect of proper precautions in behalf of the mining company, is to be considered as a fact proved. Undoubtedly, the existence of the contract supplied a motive to both parties to increase the amount of milling by the extraction of low-grade ores, and it may fairly be argued that it also afforded an inducement to Levy to connive at a careless and inefficient system of milling by which a larger number of tons would be milled at the same cost, and consequently at a larger profit. But proof of a motive to commit a wrong is scarcely sufficient by itself to prove that the wrong has actually been committed, and it remains to be considered whether there was any other substantial evidence of the mining of low-grade ores or of imperfect milling.
This brings us to the questions which have received the principal attention of counsel both in the oral and printed arguments, a proper discussion of which involves a preliminary statement in regard to the custom prevailing along the Comstock lode in regard to the mining and reduction of its gold and silver bearing ores.
It has never been the custom on the Comstock for the miner to supervise the taking of the mill samples. Occasionally a man has been employed by some of the mining companies to watch the milling at custom mills, but usually no such precaution is taken, the car sample assays, which are daily compared with the pulp assays, being deemed a sufficient check on any misconduct or negligence of the miller, besides which there is the additional security afforded by the manner in which the ore is handled from the time it leaves the mouth of the shaft until it leaves the mill as tailings. Ores of all grades are dumped promiscuously into the bins; by their own gravity they are carried from the bins to the railway cars, and from the railway cars through the grizzlies and roclc-breakers to the ore-house, from which they are fed by machinery to the batteries. From the batteries they pass, in the form of a stream of muddy water, to the settling-tanks. In this process it seems impossible that there should be any sorting of ores with a view to sampling. On the contrary, the result must be a more and more thorough mixing. It seems equally impossible that any material quantity of the ore could be lost, or otherwise diverted, without detection. The samples taken in the mill from hour to hour are taken by the men employed about the batteries and pans, working on different shifts, and in the presence and view of various other employees, to whose observation any systematic attempt to debase the samples would necessarily be exposed.
Before leaving the subject it may be well in this connection to state briefly the manner of treating the pulp after it leaves the batteries, according to the process of reduction commonly employed with what are known as the fr§e-milling ores of the Comstock lode—the process actually used in reducing the ores in question here.
After the pulp has been worked in the am algamatingpans for the time which the amalgamator deems sufficient it is drawn off into another set of pans, called “ settlers,” where it is more slowly stirred for a time, completing the process of amalgamation, and allowing the quicksilver with the amalgamated metals to settle, preparatory to drawing off. This is done through iron pipes, connected with the bottom of the settlers, through which the amalgam runs into canvas bags. These bags are provided with iron collars, and are locked to an iron framework below the settlers, in such manner that their contents cannot be removed without cutting the bag, or unlocking and detaching it from the frame. The key is carried by the superintendent or foreman of the mill. The bulk of the quicksilver strains through these canvas bags, and is caught and used over again in the pans. What remains in the bags in combination with the .gold and silver is removed from time to time and placed in an iron box, where it remains until a sufficient quantity is collected to justify • retorting. It is then placed in a retort, and the remaining quicksilver expelled by heat. The resulting crude bullion is weighed, and sent to the mint or assay office, as directed by the mine-owner, to whom the returns are made with certificates of weight and fineness by the mint or assayer. Samples of the material remaining in the settlers, similar to the battery samples, are taken every day, one for the mill and one for the mine. A comparison of the assay of the battery sample with that of the settler sample shows how closely the ore is being worked, and is especially useful to the amalgamator as . an indication, of any imperfection of his process, and of
The mill process, however, does not completely end with the settlers, for the contents of those pans pass to the agitators, where they are slowly stirred, and where in a final clean-up some additional amalgam is collected for the mine-owner. There is a continual discharge of the agitator through an aperture near the top, and the material there discharged is.called tailings. Formerly the milling ended with the discharge of these tailings from the mill, for they were allowed to run off down the-canon, and were never reclaimed by miner or miller. It was discovered, however, in course of time, that a portion of these tailings could be saved by means of blanket sluices, and worked over at a profit. The blanket sluice consists of a double line of flat, wooden troughs, set at a proper grade or inclination, and lined with blankets, over which the mill tailings are allowed to flow, with the result that there is deposited upon the blankets a portion of the quicksilver that is always escaping from the mill, and a portion of the ore, known as sulphurets, ¡which is heavier and richer than the rest of the tailings, but resists amalgamation. The material so caught in the blanket sluices is called concentrates, and is from time to time swept into tanks where it is claimed as the property of the mill-owner. According to the most definite testimony in this case, about one ton of concentrates ought to result from the working of 30 tons of ore, but the quantity varies greatly, according to different estimates. At the Nevada and Mexican mills concentrates were collected in this manner while they were-working the Hale & Norcross ores, and were worked over in the annex-pans of those mills for the benefit of the mill-owners—defendants herein.
Returning from this digression to the findings called in question by appellants, I shall first consider that in relation to the conspiracy to mine and send to the mills ores not worth the cost of mining and reduction. This-finding, like several of the others, is of no consequence-
According to the testimony of Mr. Mackay—and there is nothing to the contrary—ore of a ear sample value below $14 per ton will not pay the cost of- mining and reduction, by which I understand him to mean .that such ore will pay the bare cost of mining in a going mine, added to the bare cost of milling, without allowing any profit to the miller, or compensation for the use of his mill. His meaning, in other words, is, that a mining company, with its mine already opened and in running order, and owning its own mill, could hoist and mill $14 ore without going behind. In any other sense his. testimony on this point is inconsistent with his testimony as to the usual disparity between the car sample assay and the battery sample ass ¡y, and the percentage of the latter that ought to be obtained by good milling. In order, however, that $14 ore may pay expenses, it must, according to Mr. Mackaj% contain about an equal value of gold and silver. Otherwise, owing to the heavy discount on silver, it will not pay. Now, the evidence in this case shows that the foreman of the Hale & Norcross mine was, in effect, instructed to mine and send to the mill ore assaying by car sample as low as $12, and it appears that the Hale & Norcross ores contained a much larger percentage of silver than of gold. In view of these facts, which
I account for this finding, and for the fact that no damages were awarded by reason of it, in this way: The superior court held that in view of the contract or understanding that $7 per ton was to be paid for the milling, and the actual return in bullion of only about 75 per cent of the battery sample assay, the parties must have known that not only $14 ore but ore of even higher grade was being mined and reduced at a loss. In determining the question of damages, however, all losses were comprised under two heads, viz: Excessive price paid for milling and loss by imperfect milling. In order to determine these amounts the milling was reduced to actual cost, and the defendants were charged with 75 per cent of the car sample assay. This being done there remained no appreciable loss on the mining of low-grade ores, except upon the comparatively small quantity assaying less than $12, which the court was justified in finding was unintentionally and unavoidably deposited in the ore-bins before the mine assays could be returned. The calculation upon which I suppose the court to have proceeded would be as follows: 75 per cent of $14 is $10.50, or gold $5.25, and silver $5.25, which at 80 per cent equals $4.20, making a net yield of $9.45, of which $4.50 was allowed for milling and $4.95 for cost of mining. I do not think that this basis of calculation was entirely correct in view of other evidence in the case, but it was the basis upon which the court seems to have proceeded, and assuming its correctness, the finding in question and the conclusions of the court are rendered perfectly consistent.
The next—and by far the most important—exception to the decision of the superior court relates to the various findings to the effect that Haywood, Hobart* Levy and the other defendants worked the ores of the Hale & Norcross company by a fraudulent system of imperfect milling, by which a large portion of theiivalue was left in the slimes, tailings, and residues of the mills. The substance and effect of these findings is that 88,887 tons of ore were worked; that its value (meaning the total amount of gold and silver contained in it) was $3,505,361, as correctly shown by the car sample assays, and that if said ores had been honestly crushed and milled, and the gold and silver honestly and with reasonable care extracted and accounted for* the bullion yield would have been $2,616,491, whereas the' actual return made by the mills was only $1,826,-873, andthe difference between these two sums, $789,-618, is the main item of the damages going to make up the judgment. The principal, and most direct, evidence in support of this finding consists of the car sample assays, wdiieh it is contended is corroborated and confirmed by proof of certain irregular and suspicious transactions between the managers of the mills and the Carson mint, as well as some other circumstances of like complexion and import.
The appellants contend that, even taking the car sample assay as a criterion of the amount of gold and silver in the ores mined and sent to the mills, the estimate of the superior court is erroneous and excessive to the extent of $34,427, and they sustain their contention by a citation of the pages and folios of the record, to which counsel for respondents have made no reply. If there is any mistake in the computations which apparently demonstrate the error alleged, it was the duty of counsel to have pointed it out. In the absence of any attempt to do so I should perhaps have been justified in assuming that the error was conceded. I have, how
But the appellants contend that the car sample assays do not, as found by the court, correctly show the true value of the ores, and in this connection they call attention to what they say is an inconsistency between the findings that the value of the ore was $3,505,361, and that it should have yielded $2,616,491 in bullion. I do not deem this an inconsistency. One sum stands for the total amount of gold and silver in the ores, and the other for the percentage (about 75 per cent), which, in the opinion of the court, it should have yielded under-proper treatment.
This objection disposed of, I come to the pivotal question in the case: the value of the car sample assays as a criterion of the value of the ore. The testimony is without conflict that, according to the general custom and course of dealing between the miners on the Comstock lode and the managers and owners of custom mills, the battery samples are, and the car samples are not, regarded as the true index of the value of the ores; that all settlements between the miner and the miller are based upon the average assay of the battery samples, and that the car sample assays are for the guidance of the miners, and useful as a check upon the mills. There is also no conflict in the evidence that the car samples always run above the true value of the ore. This fact was clearly proved when the plaintiff closed his case in chief by the testimony of his own witness, Mr. John W. Maelcay, and it was much more fully and amply proved by a number of witnesses sworn on behalf of the de
Mr. Mackay, as I have stated, was the plaintiff’s own witness, and, being examined by them with reference to this matter, said: “We take car sample assays at the mine; that is, the samples of the assays taken on top. There is always a difference between the battery and the assays at the mine; that is, the samples of the assays taken on top; for various reasons there is a good deal of the assay that comes out on top that is covered up; we-cannot get a sample from the top as close as we can in a 500 ton battery, but you get a very fair sample. To answer your question, I can tell you, if I examine the books, what has been the difference between the mine samples and the battery samples. Without stating specifically, I should think about $10 per ton. The' top or car samples are the higher; generally they run pretty close; sometimes they run variable. It is a very difficult matter.”
Being asked what the battery sample ought to be, if car samples properly taken showed an assay of $72.12 per ton, his answer was: “About $62, probably $10 difference.” In reply to another question, he said: “If the car sample was $42.62, that ought to pulp $32 or $33, or somewhere in that neighborhood.”
In answer to a question whether the difference would be less in ore of a lower grade, he said: “ Sometimes, but they will average pretty much that; about from $8 to $10—sometimes not so much, sometimes a little more.”
These clear, direct, and specific statements, made on his direct examination, xere confirmed by his crosséxamination. On his redirect examination, when testifying to the specific point that even battery samples are not always correct, owing to mistakes of the assayers—as illustrated by the fact that he had frequently obtained
It is upon this passage of Mr. Mackay’s testimony, standing alone, and construed without reference to what he had previously stated, and upon one even less to the purpose from the evidence of Mr. Holden, that counsel build their whole argument in support of the proposition that there is a substantial conflict in the evidence in regard to the disparity between the average assay of the car samples and the real value of the ore. The most they can possibly claim, however, is that while their only witness as to this matter has, in explicit terms and in answer to direct questions calling his attention to the precise point, stated and illustrated by two examples the fact that the car samples always go about $10 above the battery samples, he has, when testifying with reference to another point, made a statement in more general terms which is entirely inconsistent. For, upon the construction which counsel for respondent insist upon giving to the language last quoted, Mr. Mackay’s answers are necessarily inconsistent. They cannot be reconciled, and counsel do not attempt to reconcile them, upon the theory that in Mr. Mackay’s opinion the car samples are correct and the battery samples are incorrect—both being fairly and honestty taken—for he, like all the other witnesses, testifies directly to the contrary. So far as returns of bullion are concerned, he relies upon the battery sample exclusively. The car sample is merely a check. When the discrepancy between the two becomes too great it is an indication that some thing is wrong in the working of the ore, which calls for investigation and correction. It indicates that there is some fault in the treatment; that there is not enough
It seems a waste of time to notice the claim that Mr. Holden has here testified that car samples are reliable. All that he says is that when you get a fair sample—a sample which truly indicates the value of the ore—it makes no difference if it is taken from the drift in which the ore is mined. The expression he uses may be said to imply that possibly a fair sample might be obtained in that way, but certainly he does not say so, and the whole tenor of his testimony, as well as of all the other witnesses, is opposed to such a notion. There, are reams of testimony in this record to the effect that the only way to sample ores is to take them out and mix them thoroughly, and that the more thorough the mixture the more reliable the sample; the more numerous and the larger the samples the closer the average; and there is nothing to the contrary. Mr. Holden himself, who
I should, perhaps, notice in this" connection a claim advanced in the course of the oral argument, but not made in the briefs, to the effect that Mr. Lyman, a witness for defendants, testified in favor of the accuracy of the car samples. Mr. Lyman was the superintendent of the Consolidated Virginia and other leading mines on the Comstock, and testified from an experience of thirty years in mining and milling Comstock ores. Testifying as to his own practice at the Consolidated Virginia, he stated that mine and car samples were daily taken and assayed in the manner above described, and that samples were also taken from the ore after it had been loaded on the cars for transportation to the mills. On cross-examination he said: “Our object in taking these samples, the mining-car sample and the railroad-car sample, and having them assayed, is to ascertain as near as we can, correctly and positively, the value of the ore extracted from the mine. Then we claim that from those samples we can check the mill; that is, if tlio mill does not make a return of a proper per cent—that is, such a percentage as my experience would dictate was proper—I would make a complaint of the mills.”' Upon this passage of Mr. Lyman’s testimony, disconnected from all he had testified to before,, and what he said almost immediately afterward in the further course of his cross-examination, the claim is made that, according to his evidence, the value of the ore may be correctly and positively known from the car
“ Q. About what percentage, if you can now recall, in your experience in handling the Consolidated Virginia ores, about what percentage do the mills make of these car samples, the mining-car or the railroad-car samples; about what percentage? A. Well, I never figured them in that manner, and I don’t know.
“ Q,. Well, I understood you to say that you took them as a check? A. Yes, sir; they are there on file; all these figures are on file in the office. We figured on a basis of the assay or value returned from the mine on the battery assay. The percentages are all figured up on the battery assay; that is the contract, I believe. The assays are not made by the mill; they are made by the mine. It is sent to the mine for assay.
“ Q. I will ask you again, how can you ascertain whether or not your ores have been properly worked if the samples, if the battery samples from which samples are taken, are made wholly by the employees of the mill, or by the owners of the mill? A. I have answered that before. The only thing that we have is this check from the mine of the assay.
“Q,. The mine assay? A. Yes, the mine assay; and that mine assay we take as a check. I will say right now, if you will permit me, that we never figured up the per cent on the mine assay, but we figure it from .the pulp from the mill, as the contract calls for.
“ Q,. Well, if you never figured the percentage, do you mean by that that you never paid any attention whatever to the railroad-car or mining-car sample assays when you come to investigate the question as to whether or. not the mill company has returned you or made you a proper return for milling its ores? A. Ho, sir; I don’t mean that at all.
“ Q. Well, what do you mean? A. Well, I mean this:*408 That there is a difference between the car assay in the mine and in the mill. It varies from $10 to $6 apiece. If you figure the 10 per cent on the' mill assay, and if you figure it on the mine assay, it will be so much. The per cent from the mine assay will be less than that from the mill, because there is from $6 to $10 difference; but I have not figured that out, or worked it out, down to a point where it can be answered. Our books will answer-whenever they are called for.”
I have now quoted all the testimony cited by counsel to sustain the finding of the superior court that the value of the Hale & Norcross ores is correctly shown by the car sample assays, and have only to repeat what I said in the beginning, that in my opinion it does not raise a substantial conflict with the evidence of the various witnesses who testified that the car sample assay always exaggerates the value of the ore. It remains only to notice the legitimate argument of counsel for the respondent, that, if the fact is as these witnesses claim, there ought to be some rational explanation of it. I quite agree with counsel on this point, that there must be some cause of uniform operation to bring about the invariable result that the average of the car sample assay always goes above the real value of the ore; and that, if such cause exists, some one ought to be able to point it out. I think, however, that, aside from other suggestions of witnesses and counsel, a perfectly rational and probable explanation is to be found in the evidence. There was a strong preponderance of evidence to the effect that not only on the Comstock, but in other localities, the richer portions of the ore are more easily broken—and in blasting and picking commonly break into smaller fragments—than the poorer portions of the rock, and that the miner who takes the car samples habitually takes the smaller particles in preference to the larger ones, not only because he is instructed to do so, but because under, the operation of a natural law of mechanics the finer portions of the ore are on the top and in the center of the car; that is to say, when the
If my views as to the effect of the evidence on this point are correct it follows that there is no basis left for the estimate of the court as to the amount of damage sustained by the Hale & Norcross company by reason of fraudulent or imperfect milling. It has already been shown that, even on the theory that those ores actually contained the amount of gold and silver indicated by the car sample assays, their total value was overestimated in the findings by more than $34,000. If this is deducted, and a further deduction of $10 a ton (according to the estimate of Mr. Mackay, the plaintiff’s own witness) is made on account of the difference between the car sample assays and the actual value of the ores, it reduces the estimate of the superior court over $900,-000 on the original value of the ores and makes a corresponding reduction in the amount of bullion supposed to have been lost or diverted; or, in other wmrds, since the defendants were held for about 75 per cent of the gold and silver supposed to have been contained in the ore, the judgment would require to be reduced by nearly $700,000. If, instead of deducting $10 per ton, only half that amount were taken off, the judgment would be reduced by over $350,000, to which must be added the greater portion of the loss apportionable to the ores worked at the Vivian mill, amounting, on the basis of the estimate of the superior court, to about $70,000. I do not add the whole of the supposed loss at the Vivian mill, because, as above shown, the principal-error in overvaluation of the ores, according to the car samples,
It will be seen that, in all my calculations and estimates, I assume that 75 per cent of the assay value of the ores is a proper return in bullion to be made by the mill. I would not have it supposed that I have overlooked the contention of counsel that there is evidence to sustain a finding that a higher return should be made from ores properly worked. But the obvious answer to this is that the superior court has made no such finding. On the contrary, it is as clear as any mathematical demonstration can be, that the superior court’s estimate of damages rests upon the assumption that a proper return is 74.6 per cent, a fraction less than the percentage i have assumed. The evidence would easily have supported a finding in favor of. a still smaller percentage, while a finding in favor of a higher percentage would have had no substantial support. The evidence of Mr. Holden that a return of from 80 to 85 per cent ought to be made, when properly understood, perfectly agrees with that of the other witnesses. In his estimate he allows for moisture in the ore. He expects a return of from 80 to 85 per cent, but only from the number of dry tons, and the uncontradicted evidence in this case is that the Hale & Norcross ores contain from 8 to 10 per cent of moisture, or, in other -words," that in every 100 tons of ore sent to the mill there were at least 8 tons of water, and, consequently not more than 92 tons of dry ore. Now 82£ per cent (the medium of Mr. Holden’s estimate) of _92 is only 75.85 per cent of 100. This brings his estimate into substantial agreement with those of the other witnesses. Besides all this, it is proper to add that the court had another good reason for discounting Mr. Holden’s opinion as to the ores in question. He had had no experience in working the Comstock ores, and knew nothing about them, except from his dealing in those of a high grade—ores running into hundreds of dollars to the ton, such as would bear transportation to San Francisco and Swansea, and jus
Finally, it may be said that if the defendants w'ere held for the return which Mr. Lyman would hope to get, i. e., 65 per cent of the car sample assay, the judgment on that basis would be more than $350,000 less than that which wras actually rendered.
It is claimed that there is another serious error in the estimate of losses by milling, arising out of the disregard by the superior court of the discount on silver bullion. . It is doubtful, however, if the evidence in relation to this matter is sufficiently clear to demonstrate the error alleged. The claim is, that in all the car sample assays—the basis upon which the court estimated the bullion contents of the ores in question—the silver was reckoned at $1.2929 per ounce; that is to say, at its standard value according to the number of grains of .pure silver (371.25) in a coin dollar, and that in computing the loss the court has taken the same standard of value, for the missing silver bullion, and awarded a money judgment for the- resulting amount, when the actual market value of the bullion was at least 20 per cent below the standard value. If this is so, it was certainly a very serious error, amounting, according to my estimate, to at least $100,000, and probably to a good deal more; for there can be no doubt that a judgment
I do not find, however, any direct evidence that the car sample assays were made upon the basis of $1.2929 per ounce of silver. The evidence, it is true, does show that the battery or pulp sample assays were based upon that assumed value, and since the car sample assays were made by the same assayer, and at the same time, it is perhaps a fair inference that they were computed on the same basis. But, however this may be, a decision of the point is not necessary here. There must be a new trial of that issue for other reasons, and it is sufficient to indicate our views as to the proper allowance to be made, in case it shall appear that the ore assays were based upon an assumed value of silver bullion different from its market value.
The true method of determining the loss sustained by imperfect or fraudulent milling is to ascertain the quantity of gold and silver actually contained in the ore, as nearly as practicable, next to ascertain what percentage of the bullion contents should be returned by fair and honest milling, and the difference between this amount and the actual return is the actual damage. To make these computations it is obvious that the standard of value must be the same in the assays of ore and in the assays of bullion returned, and it makes no difference whether this is $1.2929 or any other figure, provided that it is the standard used by-the assayer of the ores, and is uniform. By this means alone can the true difference between the proper return and the actual return be correctly determined. When this has been done, in order to determine the amount of the damages for the purpose of the judgment, the money value of the difference must be obtained by allowing for the discount on the silver—whatever it was.
I find that, roughly speaking, the Hale & Norcross ores, according to the car sample assays, contained about
Since the necessary consequence of these errors in the findings is that there must be a new trial as to the question of damages from imperfect milling, it does not seem worth while to discuss the evidence offered to corroborate the general charge of fraud in the milling— by which I mean the evidence intended to show how it ■was possible to debase the battery samples, or to run the value of the ore into the tailings by improper amalgamation, or to abstract the amalgam, or purloin the bullion. All these things have their place, as tending more or less to corroborate other evidence of improper milling, and are entitled to such weight as the trial judge may think belongs to them, when considered in connection with the more direct evidence of the assay value of the ores, the bullion returns made, and the percentage that ought to be returned with correct milling. There are one or two matters, however, connected with the milling which require to be noticed.
Exception is taken to the finding to the effect that the slimes and concentrates resulting from the working of these ores were the property of the Hale & Norcross company, on the ground that all the evidence shows that,' according to the universal practice and understanding,
A claim is made on behalf of respondent that the superior court was justified by the doctrine omnia prsesumnnter contra spoliatorem, in assuming that the Fíale & Norcross ores were of the value shown by the car sample assays, and, in support of this contention, they cite the celebrated ring case of Armory v. Belamire, 1 Strange, 505. That was a case in which the defendant, a jeweler, had taken a ring, removed the jewel, and kept it wrongfully from the plaintiff, and the jury were directed to make the value of the best jewel that would fit the setting the measure of their verdict, unless the defendant would produce the jewel and show it to be of less value. The meaning and the limitations of the doctrine of this case are stated in the notes appended to the report, in 1 Smith’s Leading Cases, Hare and Wallace’s edition, 589: “It signifies that, if a man by his own tortious act withhold the evidence by which the nature of his case would be manifested, every presumption to his disadvantage will be adopted.....When the nature of a Wrongful act is such that it not only inflicts an injury, but takes away the means of proving the nature and extent of the loss, the law will aid a recovery
“The presumption contra spoliatorem also arises when a party to a suit or controversy willfully destroys or suppresses, bjr wrongful or dishonest means, a deed, will, or other instrument which belongs to, or would be admissible if called for by, the opposite party, and will justify a court or jury in drawing the most unfavorable inference, consistent with reason and probability, as to the nature and effect of the evidence wnich they have thus been precluded from using and examining as a means for the discovery of truth.....
“ The extent and force of the presumption must evi- ' dently vary with the nature of the wrong and the circumstances under which it wras committed, and it will not, perhaps, even when most hostile, be an absolute . and insuperable bar.....
“The presumption arising from the wrongful destruction or suppression of evidence will not, however, justify a judgment or decree without evidence, nor the substitution of conjecture or allegation for proof; and its legitimate effect is confined to rendering evidence admissible which could not be received under ordinary circumstances, and the deduction of every inference from the evidence actually given in favor of the injured party and against the spoliator. . . . .
“The better opinion would seem to be that the mere fact of withdrawing or refusing to produce an instru
“A line should obviously be drawn between those instruments or means of evidence in w'hich the parties have a common interest, and consequent right to expect that they will be forthcoming when needed, and those which are intended only to meet the eye, or kept solely for the benefit of the person by whom they are withheld, and the conduct of a tenant who refuses to supply the loss of- a lease by the production of the counterpart is viewed in a more unfavorable aspect than that of a merchant or tradesman who withholds private books or papers from a public examination which he may desire to avoid for reasons having little or nothing to do with the particular case in which their production is demanded.”
Applying the doctrine as expounded in the foregoing quotations, it falls very far short of sustaining the contention of respondent.
In the first place, the facts of the case do not make it applicable. The milling of the Hale & Norcross ores was not in itself a wrongful act. The means by which the employment to mill them was obtained was wrongful, and entails the penalties which are to be considered hereafter; but the milling, if properly conducted, was a lawful, legitimate, aud necessary operation. The form of the ores was, of course, changed, and their identity destroyed, but the usual means, and the only means of establishing their value, were taken, and the evidence preserved. There were the car sample and the pulp sample and the settler sample assays, all taken according to the usual course of the business, and all pre
As to the claim that evidence was suppressed by failing to keep any record of the bullion resulting from the working over of concentrates, and by the refusal to produce the books of the Nevada Mill & Mining Company, the record does not bear out the assertions of counsel. There was no record kept in the mill of the working of the concentrates, or, so far as appears, of any other part of the business. The books containing a record of the business of the mill were kept at the office of the corporation, and the testimony of Williams, the superintendent of the mill, is that the account of the proceeds of the concentrates of all the ore worked in the Nevada mill, amounting to 93,000 tons, inclusive of 53,000 tons of Hale & Norcoss ore, was kept in the books of the corporation, and showed a product of only about $14,000. Mr. Williams, when the crude bullion was delivered to him by the foreman of the mill who had charge of the retorting and who kept a memoran
Another alleged suppression of evidence was in the refusal of the cashier and clerks of the Bullion and Exchange Bank of Carson to exhibit the books of that concern at the time of the taking of their depositions. Evan Williams was vice-president and principal stockholder of the Bullion and Exchange Bank, and Hofer, the cashier, and Brown and Peters, the clerks, may be said to have been in his employ and under his control. He was also a stockholder of the Nevada Mill & Mining Company, and superintendent of its mill and of the Mexican mill. But he has never been a party to this action, and at the time the depositions were taken neither Hayward, Hobart, nor the Nevada Mill & Mining Company had been brought in. No demand was then made, nor has any demand been since madej upon any party to this action for a production or inspection of the books of the bank, and bow, under the circumstances, they can be treated as spoliators of testimony is not apparent.
In connection with this subject of suppression and spoliation of evidence, a good deal has been said in reference to the mint transactions, which were more particularly urged in the argument, as evidence of the purloining of bullion, or of large returns secured by the mill-owners from the working over of tailings, etc. As to the weight of this evidence as affecting the question of improper milling, any discussion in this opinion in anticipation of a new trial would be out of place, and with reference to the doctrine of spoliation little need
It does not seem necessary to further extend this discussion of the evidence relating to the values of the
As to the other element or item of damage—exorbitant charges for milling—the evidence and findings are so clear that nothing is left for decision, except a pure question of law.
The finding of the superior court that the cost of milling did not exceed $4.50 per ton is fully sustained by the evidence; and it is equally clear that $4.50 was not a fair price for milling as between a miner and a miller dealing bn equal terms, and under circumstances entitling the miller to a fair compensation for the use of his mill. The question, therefore, is whether, in view of the manner in which the contract to mill these ores was obtained and executed, the mill-owners are entitled to receive any thing for the use of their mills. If they are there must be a new trial of this part of the case; if they are not, then, so far at least as Levy and the mill-owners are concerned, there is no need of a new trial. As to the other directors against whom there are several judgments the case may be to some extent different.
Were the mill-owners in this case entitled to retain out of the moneys paid them for milling the ordinary and reasonable price of milling, including a fair return on the capital invested in the mills ?
The authorities to which we have been cited, including the case so much relied on by counsel for respondent (St. Paul Distilling Co. v. Pratt, 45 Minn. 215), are all ■consistent with, and several of them directly sustain, the proposition that a trustee who has contracted with himself on behalf of his cestui que trust, and has received the stipulated prices of his goods or services, although he cannot, when called upon to account, retain the whole sum so received, may be, and in equity ought to be, allowed to retain what is equivalent to the benefits and advantages actually received by his cestui que trust; or, in other words, that he is entitled to the reasonable value of his goods or services, measured by their current
But I do not think this case can be determined by the rule applied to cases which involved no element of misconduct, except an express agreement of a trustee to pay himself more than reasonable value.
Here, as has been shown, was a contract which made it to the interest of the actual manager of the mining company to sacrifice the interests of the stockholders by mining and milling ores which would not pay the cost of mining added to the current price of milling. The court has found, and the evidence is sufficient to sustain the finding, that such low-grade ores were intentionally mined and sent to the mills, involving certain loss to the stockholders if the current price were allowed, but involving no loss if the millers were limited to the actual cost of milling. Under these circumstances it was not inequitable to allow only the actual cost of milling. It is true that a large proportion of the ores were of sufficient value to pay a profit pn the mining and milling current rates, with a return of 75 per cent of the pulp assay, and it may be argued that, as to such ores, the market price of milling should be allowed. But in cases of this kind the courts cannot be expected to go into very nice calculations and estimates to save parties from the consequences of wrongdoing; and, where it appears that the intention was to mine and mill ores that would barely pay the cost of handling, and where this intention was in fact carried out, a court of equity is justified in applying to the whole transaction one measure of compensation, and that measure must be actual cost.
My conclusion is that the superior court did not err in requiring the mill-owners to account for $2.50 per ton for all the ores milled by them; and this part of the judgment, which is erroneous only so far as it includes the ores worked at the Vivian mill, may be modified
As to the Nevada Mill & Mining Company, it would be necessary to reduce this part of the judgment still further on account of the fact that it had nothing to do with the ores reduced at the Mexican mill, but this and all other errors in the proceedings affecting that corporation become immaterial in view of my conclusion that it was never brought under the jurisdiction of the superior court. It is a Nevada corporation, and the only service of summons was made on Evan Williams, the superintendent of its mill at Virginia City, who was at the time of service in attendance upon the trial of this cause, but not engaged in attending to any business of the corporation in this state. Such service was wholly insufficient to confer any jurisdiction over the company, and the judgment as to it is erroneous in toto.
As to the directors of the Hale & Norcross Company, other than Levy, it is not seriously contended that they are liable except on the gound of negligence, and it is clear that such was the opinion of the superior court. Bnt they were not charged with negligence in the complaint, but only with fraud. Fraud and negligence, however culpable, are not the same thing. It is true that, when negligence causes an injury of the same character as would be occasioned by an intentional fraud, it is visited with the same consequences, so far as compensation to the injured party is concerned, but the plaintiff has no right to demand a conviction of fraud when no fraud has been committed; when he relies on . fraud he ought to plead fraud, and when he relies on negligence he ought to plead negligence, not only because the defendant has a right to know what the charge is which he is called upon td meet, but because the defenses are different. An action for relief on the ground
This clause of the constitution has never been construed, so far as I can discover. According to its literal terms, every director of a corporation is severally liable for the full amount of any misappropriation of its funds during his term of office, without respect to any question as to his own culpability, and the argument of counsel is that it must be enforced according to its letter. Ita lex scripta est, and- hence a director, no matter how innocent he may be, and no matter how hard the case may be, must be adjudged to pay, at the suit of any stockholder, the whole of any misappropriation of corporate funds occurring during his term of office. And, therefore, according to the contention of counsel, if some large stockholder of the Hale & Norcross company, with the sole purpose of protecting his own interests and the interests of the other stockholders, had, by cumulating his stock, secured an election to the board of directors, and, as a member of the board, had opposed the milling of low-grade ores, or the payment of more than $4.50 per ton for milling, and had, to the utmost of his ability, guarded the interests of the company in every direction, he could, nevertheless, have been singled out by any stockholder and compelled to make
If this construction must obtain, it seems very clear that no man with any property or character to lose will be willing to serve as director of a California corporation, after it becomes known that the constitution contains such a provision. I do not think, however, that the construction contended for can be allowed. It does seem that it was the intention of the framers of the constitution to make each director of a corporation severally liable, whether individually culpable or not, for certain hinds of losses to the corporation occurring during his'term of office; that is to say, he is made liable for embezzlement or misappropriation of corporate funds by officers of the corporation. But, in my opinion, the word “ misappropriation” is to be construed by the maxim noscitur a sociis; it means some thing like embezzlement, or, in other words, it means the misapplication of funds intrusted to an officer for a particular purpose, by devoting them to some unauthorized purpose, and does not apply to the payment of an extravagant price for services or materials properly appertaining to the business of the corporation—which is this case.- For losses occasioned by such means the law affords an ample remedy, without the need of resorting to the constitution against those who are justly responsible, whether by reason of fraud or negligence; but the law does not in such cases visit upon the innocent the sins of the guilty, and, if the liability arises from negligence, the action must be commenced in two years after it accrues, whereas, if it arises out of fraud, it may be commenced at any time within three years after the discovery of the facts. In this case, if the directors had been sued for negligence only in paying too much for milling the ores, the statute of limitations would have been a complete defense as to some of them, and a partial defense as to others. For these reasons I think the directors other than Levy are entitled to a new trial of the whole issue.
Objection is made to the right of the plaintiff, Fox,
The finding of the court is, however, that he was at all times a stockholder, and as this finding is not attacked in the specifications of grounds in the statement on motion for a new trial, we cannot look at the evidence; and in construing the finding we must hold that it means that he was a stockholder in a substantial sense.
Objection is made to the form of the judgment or judgments upon various grounds, but these are objections which should have been made to the complaint. Having waived any objection to the complaint on the ground of misjoinder, etc., I think the objection to the several judgments on account of their mere form comes too late. In form they follow the complaint, and, if the several judgments had been for the respective amounts for which the defendants were liable, the form in which they were entered would have afforded no substantial ground of complaint.
In view of these conclusions upon the main points in controversy, most of the other assignments of error become immaterial, and, so far as the points not herein particularly discussed seem likely to arise upon a new trial, I see no substantial error calling for particular discussion.
To summarize the above views, my conclusion is that the record sustains, or fails to sustain, the findings and conclusions of the superior court in the following particulars:
1. That the defendants Hayward, Hobart, and Levy formed a fraudulent combination and agreement for mining and milling the ores of the Hale & Norcross Silver Mining Company, but that t,he other directors of the mining company were not parth i to this agreement,*428 but were merely negligent in the performance of their duties, and are, therefore, chargeable only with such negligence, and are not chargeable with any actual fraud.
2. That I the Mexican and Nevada mills -were under the control of Hayward, Hobart, and the Nevada Mill & Mining Company, but that it is not shown that the Vivian mill was under their control.
3. That Hayward, Hobart, and Levy, with the acquiescence and consent of the officers of the Hale & Nor-cross company, controlled the affairs of that company.
4. That Hayward, Hobart, and Levy, in pursuance of their agreement aforesaid, caused a quantity of inferior and worthless ores to be extracted from the mine and to be milled, after being mixed with ores of a higher grade. i *
5. That the Hale & Norcross company paid $7 per ton for milling said ores; that the actual cost-of milling the same was but $4.50 per ton; that, by reason of their fraud, as aforesaid, the said defendants were entitled to receive only the actual cost of milling said ores; that, by reason of having been required to pay $7 per ton for milling said ores, the Hale & Norcross company had sustained damage in the amount of $210,197.50.
6. That the evidence is insufficient to sustain the finding of the court that the Hale & Norcross company had sustained damage by reason of the improper milling of the ores in the amount of $789,618, and that the actual amount of damage sustained thereby cannot be determined from the findings of the court.
7. That the Nevada Mill & Mining Company, not having been served with process, was not before the •court as a defendant.
The cause is, therefore, remanded to the superior court with the following directions, viz: The judgment appealed from is set aside, and the superior court is directed to enter a judgment, as of the date of its former judgment, against Alvinza Hayward and H. M. Levy • for the sum; of $210,197.50, with interest from that date, upon the issue pr> sented by the claim for having paid
Until the Nevada Milling and Mining Company has been brought before the court the court will make no trial of the issues against that company!
Harrison, J., Van Fleet, J., Henshaw, J., Temple, J., and McFarland, J., concurred.
Concurrence Opinion
I concur in that portion of the judgment which is affirmed; but dissent from the opinion of the court wherein it is held that the evidence-is insufficient to support the finding of fact to the effect that 74.6 per cent of the car sample assay is a fair return to the Hale & Norcross Company. The actual return to this mining company by the milling company was but 52 per cent of the car sample assay. This was not.
The witness, Holden, testifies that the mining company should have had a return of 85 per cent upon the basis of the pulp sample assay. If we allow a variation of 10 per cent between the car sample assay and the pulp sample* assay, then under this testimony there should have been a return to the mining company of about 76.5 per cent of the car sample assay. It is attempted to reduce this percentage by a claim of allowance or discount for moisture and evaporation. There
Rehearing denied.