Empire State-Idaho Mining & Developing Company v. Hanley

The defendant in error, complainant below, brought suit in the circuit court of the United States for the district of Idaho against the Empire State-Idaho Mining & Developing Company and the Federal Mining & Smelting Company, appellants herein. The bill, filed July 27, 1904, alleged diversity of citizenship as the ground of jurisdiction, and averred that the Empire State-Idaho Mining & Developing Company, the Federal Mining & Smelting Company, and complainant are the owners and possessors, as tenants in common, of the Skookum mine and mining claim and the ores therein contained, situated in Yreka mining district, Shoshone county, Idaho. The complainant was alleged to be the owner of an undivided one-eighth interest in the fee thereof, and the Empire State-Idaho Mining & Developing Company the owner of the undivided seven eighths of said mine and claim.

There are other allegations, not necessary to be here set out, and then, in the eighth paragraph of the bill, it is alleged:

'8. That prior to May 17, 1902, the defendant Empire State-Idaho Mining & Developing Company extracted from said mine, through said tunnels, large quantities of ore, and sold the same, and received all of the proceeds thereof, and paid no part of the same to complainant; that complainant brought suit on March 19, 1899, in the United States circuit court, district of Idaho (a court having jurisdiction of the parties and subject-matter), against said defendant and Charles Sweeny and F. Lewis Clark, to recover his share of the proceeds, and to quiet his title to said mine and ore bodies; and in said suit recovered a decree against said defendant Empire State-Idaho Mining & Developing Company, duly given and made in said United States circuit court at Moscow, Idaho, on or about November 17, 1902, for the sum of one hundred seventy-five thousand dollars ($175,000), and which decree quieted the title of this complainant to said one-eighth interest in said claim and ore bodies, a certified and attested copy of which decree was, on the___day of November, 1902, recorded in Shoshone county, Idaho, and the amount decreed to complainant therein remains unpaid and unsatisfied, excepting the sum of $5,523.42; that, as the result of an appeal from said decree by complainant, the same was, on the 10th day of May, 1904, so modified as to make the amount thereof $255,061.40, with interest thereon from February 15 until paid, at 7 per cent per annum, and the said amount and every part thereof is now unpaid.'

The bill avers the extraction of a large amount of ore in which the complainant alleges he is entitled to an interest, and that the defendants the Empire State-Idaho Mining & Developing Company and the Federal Mining & Smelting Company deny the title of the complainant to the mining and ore bodies. It further avers that the defendants are appropriating the ores mined to their own use, and, after other allegations not necessary to be set out, prays for an injunction restraining the defendants from extracting ore from the Skookum mine pending the suit, and for an accounting for the ores extracted from the mines and claim since May 17, 1902.

By the amended answer the defendants, among other defenses, set up that the ores which they are extracting belong to a vein or lode not having its apex within the Skookum mining claim, but belonging to a vein having its apex within the lode mining claim lying to the north of the Skookum claim and a part of the San Carlos claim, owned by the defendants, and deny that the defendants are mining any ores in which the complainant has any right, and avers that the claim thereto is without merit; and, coming to answer the eighth paragraph of the bill, setting up the decree upon which the plaintiff relied for his title, the defendants set up paragraphs 6 and 7:

'6. Answering paragraph eighth of the bill, these defendants admit that an action was brought against the parties named in said paragraph as alleged therein, but deny that said action was brought to quiet title to said ore bodies, or that the decree therein did in fact quiet title to said ore bodies or to an undivided one-eighth interest therein in the complainant, and allege further concerning said decree in said action that the court, in the said action, had no jurisdiction to determine title to the said Skookum mine or to the ore bodies lying within or beneath the said mining claim, for the reason that the bill of complaint in the said action does not purport to be an action to quiet title to the said mine or ore bodies, nor does the same make a case for the quieting of title thereto, nor is it such as to authorize the decree rendered in said action, purporting to quiet the title to said mine and ore bodies, and for the further reason alleged by defendants to be a fact, that no opportunity was given to the defendants therein to litigate the title to said ore bodies before the decree in said action purporting to quiet title was rendered, and for the further reason that, at the time of the commencement of said action, the defendant herein, Empire State-Idaho Mining & Developing Company, was, as shown by the complaint herein, in exclusive possession of such ore bodies, and the complainant was out of possession thereof, and an action of law alone would lie in the Federal court to determine title to such ore bodies, and that the defendant therein, being the defendant Empire State-Idaho Mining & Developing Company, had a right, under the laws and Constitution of the United States, to a trial by jury of the question of title to said ore bodies, and defendants allege that so much of the decree in said action as undertook or purported to quiet title to such ore bodies was and is absolutely void as to the Empire State-Idaho Mining & Developing Company, because the same constituted and was in fact an attempt to deprive it of its property without due process of law within the meaning of article 5 of the amendments to the Constitution of the United States, and because the same constituted an adjudication of its property rights without its consent by the court without a jury, contrary to the provisions of article 7 of the amendments to the Constitution of the United States.

'7. The defendants attach hereto, marked Exhibit A, and pray that the same may be taken as a part of this answer, copies of the complaint, answer, and replication in the action referred to in the eighth paragraph in the bill, and allege that the same constituted the sole pleadings in the said action, and, together with the evidence, constituted the sole basis for the final decree rendered therein, a copy of which is attached hereto and marked Exhibit B, and made a part hereof; that after the replication in said cause was filed testimony was taken before an examiner, on the part of the complainant, in support of the allegations contained in the bill, to wit, the allegations that the defendants Clark and Sweeney had acquired the one-eight interest in the Skookum mine from the complainant by fraud, covin, and deceit, and testimony was introduced by the defendants contradicting the testimony of the complainant, and tending to support the affirmative allegations of the answer, and no testimony was offered or taken, either for complainant or defendants, concerning the said one-eighth interest except the evidence for and against fraud, covin, and deceit, as before alleged. Thereupon the said cause was submitted to the court for decision, and the said circuit court entered a decree in favor of the defendants therein. Thereupon complainant in that suit appealed to the United States court of appeals for the ninth circuit from the said decree, and the said court, after a hearing upon the pleadings and the evidence before it, found that the allegations of the bill relating to the fraud in procuring title to the one-eighth interest claimed by the said Hanley were sustained by the evidence, and the decree was reversed and the cause sent back to the circuit court for the further proceedings in accordance with the opinion. Thereupon an order was made by the circuit court directing an accounting, and evidence was introduced by complainant to show the amount and value of ores extracted from the Skookum mine prior to May, 1902, by the defendants in said suit. That defendants in the said action thereupon offered to prove that the said ore so extracted from underneath the Skookum mine prior to that time was part of the vein having its apex in the said San Carlos claim, above referred to, owned by defendants, and that the said San Carlos claim was so located that its extralateral rights included the ore bodies from which the said ores were extracted. The said offer to prove the said fact was thereupon denied by the said court, acting under the order of the United States circuit court of appeals for the ninth circuit, in a certain mandamus proceeding brought in said court to test the question; that defendants in the said action thereafter, and at all times, contended and insisted that they had a right to show in the accounting that the ores taken from under the Skookum claim were a part of the vein apexing in the San Carlos claim, of which the defendants were the owners, and that the court was without jurisdiction to render a decree in the said action quieting title to the Skookum mine, or to the ore bodies referred to in the bill of complaint, but its contentions and objections and were overruled and the decree averred by the complainant was rendered notwithstanding such protests and objections; and defendants aver that the said decree purporting to quiet title in said ore bodies was rendered without evidence being taken upon the said contention of the defendants, and without any evidence whatever being heard which threw any light upon the contention; and said decree was thereafter, upon appeal to the United States circuit court of appeals for the ninth circuit, affirmed, the court in said cause holding as ground for its action that the bill of complaint made a cause for quieting title to the one-eighth interest in the said Skookum mine and to the ore bodies in the limits thereof, and that the defendants in said cause, having failed to plead title to the ore bodies in themselves by virtue of the facts hereinbefore set up, were estopped to litigate the said facts.'

The complainant below filed exceptions to this amended answer, in which he averred that, in the former decree, the title to the ore bodies in question was quieted, and that the issues made in that case were within the jurisdiction and power of the court to determine, and that the question of the right and title to one eighth of the Skookum mine and mining claim and ores therein contained had been determined in the former suit in favor of the complainant, and the said question had become res judicata in a court having jurisdiction of the parties and the subject-matter.

Upon hearing the exceptions to the amended answer, they were sustained and the answer held insufficient. Thereupon the defendants, averring that the court was in error and that the said amended answer constituted a defense, declined to plead further, and elected to stand upon the amended answer. The complainant thereupon moved the court for a final decree for one eighth of the amounts stated in paragraph 9 of the answer to have been mined as therein stated. A final decree was rendered accordingly, and thereupon a direct appeal was taken to this court.

Messrs. George Turner and F. T. Post for appellants.

Mr. Myron A. Folsom for appellee.

Statement by Mr. Justice Day:

Mr. Justice Day delivered the opinion of the court: