Martin v. Eagle Development Co.

69 P. 216 | Or. | 1902

Mr. Justice Wolverton,

after stating the facts, delivered the opinion of the court.

1. The defendants counsel insist preliminarily that the trial court erred in rendering a decree for the plaintiffs in the absence of any proof to support any material allegations of the complaint denied by the answer. It is, however, not conceded by opposing counsel that no evidence was taken at the trial. None has been brought up, but we find the following recital in the record, prefacing the findings of fact: ‘ ‘ and now, from the admission of the pleadings and the evidence taken before the court and filed in this suit, the court finds, — which indicates the basis for the court’s action. The recital precludes further inquiry upon the subject. The record imports verity, and we cannot look behind it and say that the decree was rendered without proof sufficient to support the disputed allegations of the complaint.

2. The next contention is as to the sufficiency of the first separate defense, which is based upon fraud and deceit. As essential elements to sustain it, there must have been false representations of material import concerning the subject-matter of the contract, the plaintiffs knowing them to be false, or representations as of their own knowledge, not knowing the truth whereof they spoke, for the purpose of misleading and deceiving the Development Company; and the company must have relied upon such representations, believing them to be true and was misled thereby to its injury: 7 Am & Eng. Ency. Law (1 ed.), 12, 17; Rolfes v. Russel, 5 Or. 400; Bullit v. Farrar, 42 Minn. 8 (43 N. W. 566, 6 L. R. A. 149, 18 Am. St. Rep. 485).

3. The first representation relied upon as being false is that the Martins were the owners of 2,000 miners’ inches of the water of Eagle Creek; that they had made a valid and indefeasible location, and had the right to appropriate the same and transfer it. Further averments in the answer, however, disclose the fact to be that the Development Company must have known and did know the exact interest the Martins owned in the alleged water right at the time, for it posted and and had recorded at once a notice relocating the 2,000 inches that plaintiffs claimed; reciting that appropriation had been made thereof by them, and that the same had been sold and assigned to the company. With such knowledge, it could not well assert that it was deceived by the representations of plaintiffs, whatever might have been their falsity. It was not misled thereby, nor induced to act to its detriment, because it was fully advised to the contrary.

4. The next consists in the representation that the mining claims were very rich in gold; that if worked as placer mines, with hydraulic appliances, they would yield in gold not less than ten cents per yard from the grass roots down, from one end of the claim to the other; that one of the Martins had thoroughly prospected and examined the claims; and that what he said could be relied upon; and these representations are alleged to have been false, to the knowledge of the plaintiffs. But the latter combat the contention' that these are sufficient upon which to base the defense, with the suggestion that the representations consist in mere matters of opinion, and must be so construed. But whether that be so or not, there is a vital defect in statement in two particulars. In support of the answer the Development Company insists that the expression “from the grass roots down” means, in mining parlance, from the grass roots to the bed rock, and that it was so understood-by miners; and that the term “prospected,” as applied to placer mines, signifies that holes have been sunk to the bed rock, and a test made of the earth in each, and the average ascertained. If such are the significations of the expression and the term, unless they are such as ordinarily attach thereto, they should have been explained, to make them intelligible. Judicial notice will be taken of the true signification of all English words and phrases and all legal expressions: Hill’s Ann. Laws, § 708, subd. 1. It is the ordinary meaning of current words and phrases to which the notice extends: 17 Am. & Eng. Ency. Law (2 ed.), 896: Nix v. Hedden, 149 U. S. 304 (13 Sup. Ct. 881). The expression, “from the grass roots down,” in its ordinary or literal sense means to tlie center of the earth, and that is as far as judicial notice can be expected to extend. If it has a peculiar signification; peculiar to a locality or to a particular industry; different from the ordinary one, — of this the court will not take notice. “To prospect” signifies “to explore for unworked deposits or ore, as a mining region;” “to do experimental work upon, as a new mining claim, for the purpose of ascertaining its probable value”: Century Diet. This is the common or current acceptation of the term. That it means what counsel would ascribe to it is foreign to such an acceptation, and we cannot be expected to take judicial notice that it has such a meaning. So that, if the meanings defendants ascribe attach to the phrase and word under discussion, they should have made them understood by appropriate allegations; otherwise the answer does not state a cause of defense within the cognizance of the court, and is therefore deficient in that particular.

5. The next alleged representation pertains to the cost of constructing the ditch, but it appears that plaintiffs were willing to undertake the work of construction for $4,000, — the same amount they represented it could be done for, — in which undertaking they failed, and the Development Company took up the work and completed it at a much greater cost. It does not appear that plaintiffs entered upon the work without intending to complete it, or or that they knew that it could not be done for the sum named, so that a false representation, knowing it to be false, cannot be imputed from the fact. This disposes of the questions presented as to the first separate defense, and, being in harmony with the action of the trial court, it follows that the demurrer thereto was properly sustained.

6. The separate answer of the defendant Cole depends for its sufficiency upon whether it shows that Hall took the mortgage bona fide and without knowledge of plaintiff’s equities. The plaintiffs, had executed and delivered to the Development Company a deed to their water rights, and this was regularly placed on record, so that, according to the record, the Development Company appeared to be the owner. The deed was executed in pursuance of the contract entered into between plaintiffs and the company for the purpose of aiding the latter in doing the work contemplated by the contract if it desired to proceed under the option thereby accorded. It is alleged, in effect, that to supply the necessary means, and to enable the company to carry forward the work under the provisions of the contract, Hall advanced the money; being the same for which the mortgage was given. Now, if he advanced it for the purpose designated, he must have known of the contract, and consequently of its terms and conditions, and hence that whatever rights or interest in the property he has acquired by virtue of the mortgage are subordinate to the equities of the plaintiffs. The answer, therefore, does not show him to have been an innocent purchaser, but quite to the contrary.

7. There is another contention in this connection, — that plaintiffs were stockholders in the Development Company, and, having had notice of the meeting at which the mortgage was authorized, they were estopped to deny Hall’s alleged superior equities. It does not appear that any of the plaintiffs were present at such meeting and participated in or assented to the execution of the mortgage of the company.. The mere fact that they were stockholders does not estop them to insist upon their rights under the contract, the interest of Hall having been acquired with notice of such rights.

The demurrer to this answer was, therefore, also properly sustained; and having now disposed of all the questions presented, favorably to the respondents, the decree of the trial court will be affirmed. Aeetrmed.