Crescent Mining Company v. Wasatch Mining Company

Statement by Mr. Justice SHIRAS:

In the year 1883 the Wasatch Mining Company, a corporation under the laws of Utah territory, brought an action in the district court for the third judicial district of that territory against William and Joseph A. Jennings to recover possession of a certain tract of mining land situated in Uintah mining district, Summit county. That action was at the time of the events subsequently narrated, and still is, pending and undecided.

The Crescent Mining Company, likewise a corporation organized under the laws of Utah territory, desiring to purchase said disputed tract of land, on March 8, 1883, entered into an agreement in writing with Jennings, whereby, after reciting the fact that the action was pending between the Wasatch Mining Company and Jennings, it was agreed that the Crescent Mining Company should purchase the said tract, and pay therefor $50,000, of which $7,500 were paid at the time of the signing of the agreement, and the balance when the deed was delivered, which latter event was to take place when the said action should be determined, and if the same should be decided in favor of Jennings; that in the mean time the deed should be deposited with the Deseret National Bank of Salt Lake City; that the Crescent Mining Company should forthwith go into possession, but until the delivery of the deed should not remove out of the premises described in the deed any metal or ores of value. It was also provided that the Crescent Company might at any time, at its option, pay the balance of the purchase money into the said bank, and lift the deed.

On July 9, 1886, the Crescent Mining Company entered into an agreement in writing with the Wasatch Mining Company, whereby the latter sold and conveyed to the former company the premises in dispute, and the latter agreed to pay therefor $42,500; and on September 1, 1886, a further agreement, in the nature of a mortgage, was entered into between the two companies, referring to the pending litigation between the Wasatch Company and Jennings, and providing that the Crescent Company would pay to the Wasatch Company the said sum of $42,500 in one year from the date thereof, absolutely, if at said time the said suit should be determined in favor of the said Wasatch Company, but, if said action should still be pending, undetermined, then said purchase money should be paid into said court in said action, recognized by order thereof, to be disposed of as follows: To be paid to the Wasatch Company on the final determination of said suit in its favor, and subject to be repaid to the Crescent Mining Company on its request, if said action should be finally, and on its merits, determined adversely to the Wasatch Company. And, in case default should be made in the payment of said purchase money, then the Wasatch Company was authorized to sell the said premises in the manner prescribed by law, and out of the proceeds to pay said purchase money, with costs, and a reasonable attorney's fee for collection; the surplus, if any, to be paid to the Crescent Mining Company.

The present suit was brought to foreclose this mortgage, the complaint alleging that the suit of Wasatch Company v. Jennings was still pending and undetermined, and that the Crescent Mining Company had not paid the amount into court, and asking for judgment for $42,500, with interest from one year after the date of said mortgage, with attorney's fee, and for a decree of foreclosure and sale.

The defendant demurred to this complaint on the ground that it did not allege that the plaintiff had obtained an order for the payment of the purchase money into court, or that such order had been made and that defendant had then refused, or that any demand had ever been made upon defendant for payment, and that it appeared on the face of the complaint that defendant, not being a party to the suit of Wasatch Company v. Jennings, could not appear in that case, and ask for an order permitting the payment into court.

This demurrer was overruled, and the Crescent Company answered, and alleged that the mortgage sued on had been given to secure the purchase money of certain described mining grounds; that, owing to a fraudulent conspiracy between the defendant's manager and certain agents of the plaintiff, the most valuable part of the lands purchased had been omitted from the deed,-and then added the facts showing that the Crescent Company could not, of itself, obtain an order to pay the purchase money into court, and that the Wasatch Company had never obtained such an order, and had never made any demand.

The answer further averred that on January 3, 1887, the Crescent Company had commenced an action, in the same court, against the Wasatch Company, to compel a reformation of the deed, so as to make said conveyance embrace all the ground, and that said last-mentioned action had resulted in a decree commanding a reformation of the deed as prayed for; that said decree had been appealed from into the supreme court of the territory of Utah, which latter court had on August 27, 1888, affirmed said decree, from which said last-mentioned decree an appeal had been taken to the supreme court of the United States, where said appeal was pending. The record of that appeal in the supreme court of the United States discloses that the decision of the court below has been affirmed.

The cause was brought on for trial before the court sitting without a jury, and resulted in certain findings of fact, substantially the same as alleged in the complaint, and in findings of law as prayed for by the complainant, viz. that said plaintiff, the Wasatch Company, was entitled to have said mortgage debt, $42,500, paid into that court, in said action pending between Wasatch Company and Jennings, together with interest thereon at 10 per cent. per annum, from the 1st day of September, 1887, until the same shall have been so paid into court, together with costs and $1,000 for an attorney's fee. It was decreed that the plaintiff was entitled to a decree foreclosing said mortgage, and directing a sale of the premises covered by said mortgage, and to have so much of the proceeds of sale paid into court as might be necessary to pay said purchase money, interest, and costs as aforesaid.

From this decree an appeal was taken to the supreme court of the territory of Utah, and on June 12, 1890, an opinion and decree of that court were filed, affirming the decree of the district court in substantial respects, but modifying the same by decreeing that 30 days should be allowed the defendant, in which to pay the money, before the property should be advertised for sale, and also providing that the money should be paid into court in the case between the companies instead of the case of Wasatch Company v. Jennings, until an order should be obtained in that case for the deposit of the money. 24 Pac. 586.

The record further discloses that the Crescent Mining Company entered into possession of the property, and has been engaged, during the pendency of the litigation, in mining and converting to its own use the ores and metals contained therein.

From the decree of the supreme court of the territory of Utah, the present appeal was taken.

R. N. Baskin, for appellant.

J. G. Sutherland, A. T. Britton, and A. B. Browne, for appellee.

Mr. Justice SHIRAS, after stating the facts in the foregoing language, delivered the opinion of the court.