Fisher v. Seymour

23 Colo. 542

• Court: Supreme Court of Colorado
• Decided: January 15, 1897
• Status: Published

Opinions

Chief Justice Hayt

delivered the opinion of the court.

We cannot read the evidence in this case without being impressed with the fact that a gross fraud has been perpetrated upon plaintiff Fisher and her children, the heirs of Thomas. Fisher, deceased. The American Flag was discovered on June 11, 1879, and located June 12, 1879, the location certificate being placed upon record on June 24,1879. The location certificate of the Little Tiger lode, which was recorded June 12,1879, recites that the lode was located and claimed on that date. Upon October 14, 1880, the Little Tiger was relocated under the name of the Tiger lode. Bjr such relocation much of the territory of the American Flag claim was included in the Tiger claim.

In October, 1879, Thomas F. Walsh, one of the owners of the American Flag claim, for a valuable consideration, deeded to Thomas Fisher, the husband of plaintiff, an undivided one eighth interest in the American Flag lode, and in the month of March following Fisher purchased from another one of the locators a one fifth interest in that claim. Shortly after this last purchase Fisher sickened and died. The day before his death, and on April 9, 1880, he executed and delivered to his friend, Nicholas Finn, one of the appellants, a deed, conveying to Finn, in trust for Fisher’s wife and children, all the right, title and interest held by Fisher at the time in the American Flag lode, together with a one eighth interest in the General Shields lode, an adjoining claim, which was, at that time, a steady producer of mineral. Previous to his demise Fisher did a large amount of work upon the American Flag lode. He sank one shaft, known as the “ Fisher shaft,” to the depth of forty or fifty feet, and another shaft to the depth of twenty-five feet.

In the month of June following the death of her husband, Mrs. Fisher came to Colorado with her family. She then visited Leadville for the purpose of looking after her interests, and that of her children, in the American Flag and General Shields claims. Upon this visit Mrs. Fisher spent several months at Leadville, during which time - she made diligent inquiries to ascertain the exact condition of the title to' the American Flag claim, and the probable value of the property. At this time Thomas Walsh, one of the original owners of the property, was anxious to secure a bond upon ' the Fisher interests at the rate of $10,000 for the entire property. Knowing nothing of mines herself, Mrs. Fisher inquired . of others, including the defendants, Bloss, Herbert and Ilgenfritz, as to the value of this property, and procured an examination and opinion of experts. She swears that at this time she inquired particularly with reference to conflicts, and was then assured by all the then owners of the Little Tiger claim that there would be no conflict and no litigation with that property. This conversation the owners deny, but the fact that Mrs.' Fisher, as the result of her examination, was induced to purchase the outstanding interests in the American Flag claim, • at the rate of $10,000 for the full claim, strongly tends to corroborate her testimony upon this point.

It was upon this visit that Mrs. Fisher first became acquainted with G. M. Seymour, who was at the time the ■general manager for The General Shields Mining Company, which company owned all the General Shields mine, except the one eighth interest held by the heirs of Thomas Fisher, and represented by Mrs. Fisher. There is much conflict in the evidence with reference to the conversations between these parties. It is sufficient to say that in the fall of the year Mrs. Fisher, being about to return east, was anxious to sell her interests in both the General Shields and the American Flag locations, and offered her interest in the General Shields mine for $7,000, and her interest in the American Flag for $10,000, Seymour agreeing to assist her in making a sale at these figures. On or about the 3d or 4th day of October, Mrs. Fisher left Leadville with her family, and returned to her home in Memphis, Tenn. After her return some correspondence passed between Seymour and Mrs. Fisher with regard to the sale of these properties.

The court below, while resolving most of the conflicts in the evidence in favor of the defendants, nevertheless made a finding that Seymour was the agent of the heirs for the purpose of selling the American Flag mine. While such agent, and as soon as Mrs. Fisher had left the state, Seymour entered into an agreement with the owners of the Little Tiger claim (Bloss, Herbert and Ilgenfritz), by the terms of which agreement he was to patent that mining claim, receiving for so doing a one half interest therein. Although this agreement was made on the 6th day of October, 1880, Seymour does not appear to have moved in the matter of obtaining a patent until the January following, at a time when the property im controversy was covered with snow. Seymour .relocated the Little Tiger claim, under the name of the “ Tiger.” In making this relocation he moved the claim north some five hundred feet, thereby leaving the original discovery shaft outside of the new surface boundaries, and three hundred feet south of the same. By this relocation, he took in a greater portion of the valuable part of the American Flag location ; and the question of his right to do this is the principal controversy in this case.

Plaintiff seeks to have appellees, Seymour and others, declared trustees as to this property, claiming that she is the equitable owner and has the prior right to that portion of the premises formerly included in the American Flag location. Seymour having the patent title from the government, the plaintiff, to maintain the action on her part, must show that she had a valid and subsisting location prior, and therefore, superior, to that with which it conflicted, to wit, the Tiger ; and that the fraud of the patentee kept her in ignorance of the patent proceedings. “ If these questions be affirmatively answered, plaintiff may recover the ground in conflict.” Seymour v. Fisher, supra.

Mrs. Fisher swears that she placed the property with Seymour for sale, for $10,000, and that she was to pay him a commission if such sale was effected. Seymour admits that such a conversation took place; admits that he agreed to assist Mrs. Fisher in the sale of the property ; that the price fixed was $10,000; but denies that he was to receive any commission in case the sale was effected. Upon this evidence the court below found that Seymour did undertake to assist ■ Mrs. Fisher in the sale of the American Flag lode ; but also found that he was not her agent to look after the property, and that, in fact, no fiduciary relation existed between the parties as to the American Flag claim. The question with reference to a fiduciary relation upon the facts is one of law that is challenged upon this review, and it being conceded that Seymour undertook to sell the property for Mrs. Fisher, at an agreed price, the relation of principal and agent was certainly established.

It is apparent, we think, that Seymour never intended to act in good faith in the matter, for, within two days after the agreement with Mrs. Fisher, he relocated the Little Tiger under a new name, and, by such relocation, took in a large part of the American Flag claim owned by his principal, amending his location record accordingly. The property affected by these acts was the most valuable portion of the American Flag lode, and included the last shaft made by Mr. Fisher. In this shaft mineral of commercial value was found, this being the only ore at that time disclosed upon either of the claims. We have no doubt, from the evidence, that Seymour, in doing as he did, was largely influenced by information communicated by Mrs. Fisher at a time when she reposed in him confidence as her agent.

The law requires the utmost good faith on the part of an agent when dealing with his principal, and it is well settled that an agent, to sell, cannot purchase the property for himself, unless he makes known to his principal that he is such purchaser, and acquaints him with all the facts. Wharton on Agency, sec. 231; Story on Agency (8th ed.), sec. 210; Ewell’s Evans on Agency, sec. 218; Hunter v. Hunter, 50 Mo. 445; Porter v. Woodruff, 36 N. J. Eq. 174; Murray v. Beard et al., 102 N. Y. 505.

Applying this necessary and salutary rule to Mr. Seymour, in his dealings with Mrs. Fisher, his right to purchase the American Flag claim from her must be denied. If he could not purchase, he certainly could not “ jump ” the property, and thereby, without consideration, deprive Mrs. Fisher and her children of the property. Seymour’s conduct, in remaining silent until Mrs. Fisher had left the state, and afterwards lulling her into fancied security by corresponding with her with reference to the property, without acquainting her with the facts, although he was in the very act of procuring an adverse title, constituted a fraud in law. “ He * * * could not acquire a title to the land valid against the equity which he had acknowledged in the complainants.” Ringo et al. v. Binns et al., 10 Peters, 269.

The district court found, and Seymour admits, that he was an agent to sell; this sufficiently establishes such a fiduciary relation between the parties as requires the utmost good faith on the part of the agent; but as the other defendants, Bloss, Herbert and Ilgenfritz, owed no duty to Mrs. Fisher, they do not stand in the same relation to her as did Seymour. They might have applied for a patent to the Little Tiger or to the amended Tiger lode, and had Mrs. Fisher failed to have filed an adverse, she would have lost her rights under the provisions of section 2326 of the United States Statutes. Seymour v. Fisher, supra. It is true that plaintiff also claimed that Bloss, Herbert and Ilgenfritz were estopped by their conduct to question plaintiff’s title; but it is also true that the district court found the fact to be against plaintiff’s contention in this behalf, and thereby eliminated this issue from our consideration.

It is urged that the fraud of Seymour is immaterial because of the finding of the court that the Little Tiger lode and the amended location thereof, as the Tiger lode, was a valid and subsisting location prior and superior to the location of the American Flag lode. This is a mixed finding of law and fact. It was stipulated, for the purposes of the first trial, that the American Flag location was the prior location, and that such location was in all respects valid. Upon the last trial this stipulation was withdrawn. The uncontradicted evidence shows that the American Flag was in all respects a valid claim if a vein in place was exposed at the time of the location. The preponderance of the evidence seems to be in favor of the discovery of such mineral; but, conceding, as we do, the force of the finding to the contrary, made by the district court, upon conflicting evidence, we are to determine whether or not such finding is controlling in this case. An examination of the transcript shows the fact to be established by com' petent evidence, and undisputed, that a vein of mineral was discovered upon the American Flag claim, prior to the relocation of the Little Tiger lode, under the name of the Tiger lode, and this is sufficient to validate the American Flag location from the date of such discovery.

It is claimed that such relocation, omitting, as it did, the original discovery shaft of the. Little Tiger lode, did not relate back and make that lode a valid location from the time of the original location of the Little Tiger lode. In any event, the rights of the American Flag had attached prior to the amended location of the Tiger lode; hence, the relocation was made subject to such intervening rights.

Moreover, the evidence shows that the discovery upon which the Little Tiger location was based was not upon the public domain of the United States; but within a prior, valid, subsisting location, known as the “ Golden Curry mining claim.” Upon objections interposed by the defendants, much of the evidence offered by plaintiffs upon this matter was rejected. In this ruling of the court there was error, for, although it was not proper to allow the introduction of evidence for the purpose of impeaching the patent, this evidence was proper in order that the court might ascertain whether the owners of the American Flag or of the Little Tiger made the first valid location upon the unappropriated public domain. In other words, it was competent to show that the American Flag claim was prior in point of time and superior in right to the Little Tiger location of the ground in conflict, unless the Tiger location relates back to and acquires priority of right by reason of the location of the little Tiger claim. For the purpose of showing that the location of the Tiger could not so relate back, it was competent for the plaintiff to show that the location of the Little Tiger was void, as not having been made on the unappropriated public domain. The evidence received sufficiently establishes such invalidity.

This cause has been before the courts for many years. It has been most carefully considered by this court upon two occasions. As said in the outset of this opinion, the record discloses that Seymour practiced a gross fraud upon the heirs of Thomas Fisher, deceased; and we think that he should neither be allowed to profit by such fraudulent conduct, nor the heirs be deprived of their inheritance thereby. We are prevented from interfering with the one half interest held by Bloss, Herbert and Ilgenfritz for the reasons already given ; but as to the remaining one half held by Seymour, the same reasons do not exist, and it appearing that this title was procured in fraud of Mrs. Fisher’s rights, the title so obtained should be declared to be held by Seymour in trust .for Mrs. Fisher.

The judgment of the district court is accordingly affirmed as to Bloss, Herbert and Ilgenfritz, and reversed.as to Seymour, with directions that judgment against Seymour be entered in accordance with this opinion.

Judgment modified.