36 Colo. 18 | Colo. | 1906
delivered the opinion of the court:
This is an action by appellant Larsh, as plaintiff below, to recover a certain interest in the Neglected mine and certain unpatented mining locations, and for an accounting of the business of a mining co-partnership. Trial to the court without a jury resulted in findings for defendants, and the action was dismissed. The plaintiff is here with his appeal.
A summary of the pertinent parts of the pleadings and the responsive evidence, in connection with the various questions argued by counsel, will best present the' nature of this controversy. From the complaint it appears that in March, 1901, Gaines and Andrews owned this property. They then gave a written bond and lease of it to the defendant W. J. Boyle. This instrument was dual in character. It included an ordinary mining lease, and a naked option to purchase; the former mutual, the latter unilateral. One of the conditions of the title bond was that if Boyle paid the aggregate sum of $10,000 in several payments and at certain designated times, the owners would convey to him the mine. The first three payments of $2,000 each were to be made respectively on or before July 15, 1901, October 15, 1901, and July 15,1902, and $4,000 on or before May 1, 1903. Before the maturity of the first payment, in consideration of the payment of $100, Boyle secured from the owners an extension of one month for the payment of the balance of $1,900. Soon after the bond and lease was executed, Boyle assigned an undivided one-half of his interest therein to the defendant Dennison. About the 9th of July, 1901, Boyle and Dennison assigned an undivided half interest in the bond and lease to the plaintiff Larsh and defendant Gorman — defendant Rivers, to the
In the answer the execution of the assignment by Boyle and Dennison to Larsh and Gorman was admitted, but there was a denial that the instrument was ever delivered, and an affirmative allegation, to which the defendants testify, that the instrument, though duly executed and acknowledged by all of the parties except Dennison, was not to be delivered or become binding until Dennison acknowledged, the same, and until Larsh and Gorman paid all the purchase money, neither of which conditions was ever complied with. There was a denial, also, that Larsh had done or performed any of the things which he agreed to do under the terms of the assignment.
It was alleged in the answer and admitted by plaintiff that practically contemporaneously with the assignment to Larsh and Gorman the four parties interested in the bond and lease, Boyle, Dennison, Larsh and Gorman, entered into a mining copartner
1. We are constrained to hold that the deed of assignment was delivered. Defendants admit there was a delivery of the instrument to one of the grantees, but claim that it was conditional. The doctrine is elementary that there can he no conditional delivery or delivery in escrow, by the grantor to the grantee in a deed. Such conditional delivery must be to a stranger, and not to a party to the transaction. Here, according to defendants, the delivery was made to Rivers, one of the grantees, though his name did not appear in the instrument. In addition to this, the evidence is that both Larsh and Grorman at different
2. One of the grounds discussed at length by appellant is that Larsh, by the instrument of assignment, acquired an interest in the Neglected lode which was real estate, and that such interest could not, under the statute of frauds, be waived, released, or abandoned by parol or verbal agreement. Whether till acceptance, or part or full performance, by the holder of a naked option to purchase, an interest in real estate is created, we need not decide. Our statute of frauds, however, does not include a surrender or abandonment by operation of law. If the evidence clearly showed, as it does not, that, by his acts and conduct, Larsh plainly manifested an intention to forfeit his rights and withdraw from all connection with the mining copartnership, and absconded and abandoned his interest in the property, it might be held a surrender or yielding up by operation of law. But in this character of an option, being merely a naked privilege to acquire an interest in realty, the statute of frauds has no bearing upon the alleged
3. Another assignment of error is that the court improperly refused plaintiff’s offer to show that the payments of Larsh and Gorman of the purchase money were to be made out of the proceeds of the mine. We think this ruling, if not right, was not prejudicial, for we shall see, later on, that defendants themselves, both in their pleadings and evidence, have conclusively shown that the first and second payments were, in law, made by Larsh and his coobligor, and defendants have estopped themselves to dispute it.
4. Complaint is also made by appellant that the court was wrong in permitting defendants to introduce evidence of instructions which Dennison gave to Boyle with reference to the delivery of the deed of assignment. That ruling becomes immaterial in view of our conclusion that the evidence clearly establishes that the instrument was delivered.
5. The most important question in the case, and one which we regard as pivotal, and whose resolution requires a reversal, and direction of the judgment, is the remaining topic of discussion. In the answer, and as a separate defense, it is alleged that
The answer then proceeds with averments that plaintiff was repeatedly urged by defendants to repay the sum of $1,000 to the mining copartnership,
In the replication the plaintiff substantially admits these matters, except he says that this application of the mining company funds on the purchase money of the mine was made with the knowledge and consent of his copartners. However that may be, at the trial the court permitted defendants wholly to disregard this defense of the answer, and all of them, upon cross-examination, said that this verified defense was false. They utterly repudiate it, and say that, although Larsh did advance out of the mining partnership funds his share of the purchase price, none of the defendants knew anything about it until some time early in the following October, and when they heard of it, they protested against it, and be-ca,use of Larsh’s wrongful conduct in that particular and his inability to make the second payment due in October, 1901, they declared his rights in the co-partnership, and his interest in the property, forfeited ; in which, as they say, he acquiesced.
We are satisfied that a most grievous error was committed by the court. There was no attempt by defendants to show that through mistake this defense of the answer was inserted, nor was there any request to withdraw it, or amend their pleading to correspond to the proof. We do not say such amendment is permissible. We do say no motion to amend was made. The proofs with respect to the August
Defendants seek to explain away this palpable error by saying that, even if the court was wrong in this respect, yet, since the plaintiff wholly failed to-show a compliance by him with the conditions of the bond, as to payment, the judgment of the court should be allowed to stand. We are not satisfied with this explanation. We do not know what influence the evidence upon this branch of the case had with the trial court. For aught that appears, it was upon this very evidence that the court held that plaintiff had failed to make out a case. The doctrine is frequently enforced that a right judgment may be sustained notwithstanding bad l-easons are given for it, and some authorities go to the extent of holding that where a right conclusion has been reached and the trial is to the court without a jury, errors in admitting and rejecting evidence may be deemed harmless. We cannot say in this case that the right conclusion was reached, or could have been reached either with or without the aid of this improperly admitted evidence, and this ruling of the court in allowing the defendants to disregard entirely the allegations of their sworn answer, and testify to facts directly contradictory and inconsistent therewith is, of itself, reversible error.
But the court was in serious error in holding that plaintiff failed to make the first payment under the bond. Notwithstanding its judgment, we are satisfied from thiá defense of the answer, and upon the uncontradicted evidence, that, so far as Boyle and
If, on the other hand, as also asserted by defendants by their evidence and in other allegations' of their answer, no part of the payment of August 15 was made by Larsh, but Gorman, with the consent of Boyle and Dennison, made the entire payment himself out of partnership funds in order h> protect his interest from forfeiture by crediting upon the books of the Durango Plumbing Company, of which he was a member, the sum of $2,000 which at the time was due from the Neglected Mining Company, of which Boyle and Dennison were members, this payment, so far as the latter are concerned, was as much a payment for Larsh’s benefit as for Gorman’s. Gorman
We come now to the second payment due October 15, 1901. According to the answer and defendants’ evidence in its support, the mine was 'still running deeper and deeper in debt, which then amounted to • more than $10,000. All the parties
It conclusively appears that about the 15th of October, 1901, after the defendants all say that Larsh had voluntarily given up his interest in the mine, they were unable to get an extension of the second payment from the owners, whereupon Larsh himself made an arrangement with Gaines whereby the latter agreed to take the joint note of Boyle, Dennison, Gorman, Larsh and Rivers for his' share ($1,000) of the payment, and the five borrowed of the First National Bank of Durango, on their joint promissory note, $1,000, and deposited the same to the credit of Andrews as the payment of his share. These transactions occurred after defendants say
This extended reference to defendants’ answer and their evidence emphasizes the lack of foundation for their claim that plaintiff’s rights áre lost by his failure to pay the purchase money. But if plaintiff has not paid his share of the two- notes, the giving of which by all the parties produced the fund with which the second payment on- the title bond was made, his failure in that respect cannot forfeit his interest in the property for reasons assigned in discussing the first payment. He made the first payment, and thus partly performed — and defendants ratified it by voluntarily accepting credit on their bond, and saving a forfeiture of their rights — and now plaintiff offers fully to perform all his covenants under the bond upon an accounting both as a partner under the lease, and as one of the holders of the option.
We are of opinion, and base it on defendants’ own pleading and evidence, that, since the first payment on the bond was made by Larsh and Gorman, or one of them, and the second one of October 15 was made in a way satisfactory to defendants at the time, they are not entitled to a judgment declaring a. forfeiture of plaintiff’s interests because he did not pay these notes which all of the parties gave at the time the second payment was due, or for any of the other reasons submitted. In view of defendants’ answer and evidence, there is not any legal, competent, or sufficient proof that plaintiff surrendered or abandoned his rights under the bond or lease, or that he failed to make the payments required by the bond up to the time this action was begun. On the contrary, the findings and _ judgment, wholly irrespective of plaintiff’s evidence, but upon defendants’ own showing, should have been for plaintiff in these particulars. With respect to the plaintiff’s rights under the lease, the record does not contain sufficient data on which to báse a decree, largely because the court re
The judgment will be reversed, and the cause remanded with instructions to the district court to take further proof and render a decree as to the relative rights of the parties in the mining partnership under the lease, and for an accounting of its business affairs, and an ascertaining of what sums, if any, are due plaintiff on final settlement of its business; that an ascertainment be had as to what sums, if any, are due from plaintiff on the purchase price of the mine, on the basis of his ownership of an undivided one-fourth thereof, and that, when such sum is fixed and paid to defendants, if any be found due, that the former judgment be vacated, and a decree be entered establishing his ownership of an undivided one-fourtli interest in the Neglected Mine, and that defendants be required to make conveyance thereof to him. No further evidence shall be taken upon the matters decided by us, as indicated in the opinion, but only as to the issues concerning the mining copartnership and an accounting, just referred to, and all proceedings below must be in accordance with the views herein expressed.
jReversed.
Chief Justice Gabbert and Mr. Justice Steele concur.