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Koester v. Golden Turkey Mining Company

Supreme Court of Arizona

October 11, 1937

JOHN B. KOESTER, Appellant,
v.
GOLDEN TURKEY MINING COMPANY, a Corporation, FRANK A. ALMSTEAD, HERMAN C. MITCHELL, WILLIAM SCHUTZ and THEODORE SCHUTZ, Appellees

APPEAL from a judgment of the Superior Court of the County of Yavapai. Richard Lamson, Judge. Judgment affirmed.

Mr. A. I. Winsett, for Appellant.

Mr. Francis D. Crable, for Golden Turkey Mining Company, Mr. Herman C. Mitchall (Appellees) and Mr. F. H. Bernard, of Counsel, for said Appellees.

Messrs. O'Sullivan & Morgan, for Appellees William and Theodore Schutz.

OPINION

ROSS, J.

This is an appeal by plaintiff, John B. Koester, from a judgment on a directed verdict in [50 Ariz. 345] favor of the defendants Golden Turkey Mining Company, Frank A. Almstead, Herman C. Mitchell, William Schutz, and Theodore Schutz.

The plaintiff filed his complaint against the named defendants (and others) alleging an agreement dated February 1, 1932, between himself and defendants Almstead and Mitchell under which he agreed to advance, and did advance, $5,000 for the purpose of opening and developing certain mining claims, owned by defendants William Schutz, Theodore Schutz, and Marie Flagler, under representations that such owners would fix $40,000 as the price of the mining claims; that after the expenditure of such advance the mining claims would be worth $60,000 and in a productive state; that all sums realized over and above operating expenses would be paid to plaintiff on account of his advances or, should the property by sold, such advances would be the first charge against the amount received; and that after his advances were repaid to him the proceeds, either from sale or operation, would be divided one-third to plaintiff, one-third to the mining claim owners, and one-third to defendants Almstead and Mitchell. The said agreement and representations were known and concurred in by the other defendants. That thereafter, in August of 1932, defendant Mitchell and the mining claim owners entered into a conspiracy to defraud plaintiff of his said advances and the profits of his contract, and, in pursuance thereof, on November 7, 1932, said mining claim owners optionned the mining claims to Mitchell; that in November of 1933 the defendant Golden Turkey Mining Company was caused to be organized by the defendants, and defendant Mitchell transferred and assigned to it all his right, title, and interest in the mining claims by reason of his lease or option thereon,

It is alleged that Mitchell was in charge of the mining claims, working and operating them all the time [50 Ariz. 346] under the agreement

Page 1087

originally made, and that they were producing at a profit.

All of the defendants served with summons filed answers to the complaint. Marie Flagler was not properly served with process and did not appear and was dismissed from the action.

William and Theodore Schutz in their answer admitted ownership of the mines in conjunction with Flagler; admitted giving an option on February 1, 1932, to Almstead to purchase the mining claims for $40,000; alleged that Almstead failed to meet the terms of the option and option extension, and its cancellation and forfeiture by reason thereof; admitted giving an option, on November 7, 1932, to purchase to defendant Mitchell and that Mitchell subsequently assigned the option to the Golden Turkey Mining Company. These defendants specifically denied all the other allegations of the complaint or that they ever had any dealings whatever with plaintiff.

Defendant Almstead filed a general denial.

The defendants Mitchell and Golden Turkey Mining Company admitted the option from the owners to Mitchell and its assignment to the company, and specifically denied all the other allegations of the complaint. Also set out ...


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