Cochrane v. Justice Mining Co.

Mr. Justice Hayt

{dissenting). A decree for the specific performance of a contract is sought in this action. The contract is alleged to have been entered into between appellant and appellees upon March 18, 1889. The controversy turns almost entirely upon a bid made by plaintiff in error, Cochrane, for a lease upon a certain mining property, and the action of the board of directors of the Justice Mining Company taken thereon. The bid is as follows: “ (3) I will take lease on the whole property at thirty-five per cent, royalty at eighteen (18) months, and agree to expend, under the best management obtainable, at least $5,000 each and every month during life of lease in development work, I to have thirty (30) days to begin work, in order to make an examination of property, and put machinery in place. Lease to date from time of commencing work. Settlements as usual. [Signed] Fbank T. Cochbane & Co.”

The action of the board of directors relied upon to bind the company was taken upon March 18, 1889, and is evidenced by the following entry upon records of the company: ‘‘Moved and carried that Frank T. Cochrane & Company’s proposition for lease on three sections of the Justice property, according to the terms of paragraph 3, be accepted.

“ Moved and carried that all other bids be rejected.

“ Moved and carried that the president be empowered to draw up the lease, in conjunction with Mr. Cochrane or his agent, and present it to the board of directors for their consideration.”

Shortly thereafter a lease was prepared, satisfactory to the company, and forwarded to plaintiff in error for his acceptance. This lease Mr. Cochrane would not accept. Fie in turn prepared a lease, which the company refused to sign, and, the parties not being able to agree upon the terms of the lease, Mr. Cochran brought this suit to enforce the specific performance of the alleged contract, and compel the company to execute a lease to him in accordance therewith.

*429About the time of the meeting of the board of directors at which the foregoing resolutions were adopted, and before plaintiff in error was notified of the action taken by the company, he caused to be sent to the president of the Justice Mining Company, then at Aspen, the following telegram : “ Peter Lux: Hold my bids for leases until arrival of John Beach, Tuesday. F. T. Cochbane.”

This telegram, which was delivered before appellant received notice of the action of the board of directors, was immediately supplemented by the following letter: Denver, March 18, 1889. Peter Lux, Ésq., Aspen — Dear Sir: Please allow Mr. John Beach to correct my bids for leases, and add to them as he sees fit, as I have now some information that I did not have when I made them. He will return to you at once. Yours truly, F. T. Cochbane.” The language of the concluding clause • of the, resolutions of the board of directors relied upon as binding the company shows quite plainly that further action was contemplated by the board before any contract was to be entered into. The president of the company was not authorized to execute the lease with Mr. Cochrane. He was only authorized to draw up the lease in conjunction with Mr. Cochrane or his agent, and submit the same “ to the board of directors for their consideration.” It is unreasonable to suppose that it was to be submitted to the consideration of the board of directors with no power reserved in that body to change its terms. It is more reasonable and natural to conclude from the language employed that further action was to be taken by the company before it should be definitely and irrevocably bound.

In view of this resolution and the telegram and letter from Cochrane, it may well be doubted if the court below was not right in holding that there was no contract concluded between the parties. But should we concede the contrary, this would not, in my opinion, change the result; the bid and its acceptance not being sufficiently definite ' and certain to admit of a decree for specific performance. *430Take, for instance, the item of thirty-five per cent, royalty. Is this percentage to be based upon the gross output of the mines, after deducting transportation and smelting charges, or transportation charges only, or was the lessee to pay both? These are matters of considerable magnitude, and they are left in uncertainty, with no data by which they may be determined. So, also, in the matter relied upon as constituting an agreement, there is nothing fixed as to the place where the development work is to be expended, and nothing whatever as to the nature or character of such work.

In reference to the item of royalty the learned judge who tried the case below well said: “ This is always a matter of convention between the parties. Settlement on smelter returns in the mining camp where the property is situated, so far as our observation has gone, is always the subject of convention between the parties. In some instances the lessee pays the cost of transportation from the mine to the railroad and from the railroad to the smelter. Sometimes he is only required to pay transportation from the mine to the railroad.” In this connection it should be added that the words “ settlements as usual ” evidently refer to the time only at which settlements were to be made.

Upon the items mentioned, and many others, there is a wide, and apparently an honest, disagreement between appellant and appellees. There are some eighteen points of difference between the two leases, — the one submitted by the company and the one prepared by Mr. Cochrane. It should not be a matter of surprise, under the circumstances, that the court below, after patiently listening to the evidence, reached the conclusion that a decree for specific performance was not warranted. The evidence offered is not sufficient, in my judgment, to establish the terms of a contract with anything like the definiteness and certainty required to warrant a decree for specific performance, and the judgment of the trial court should therefore be affirmed.

Reversed.