Hames v. Rust

148 P.2d 132, 64 Cal. App. 2d 70, 1944 Cal. App. LEXIS 1023
CourtCalifornia Court of Appeal
DecidedApril 25, 1944
DocketCiv. No. 6727
StatusPublished
Cited by1 cases

This text of 148 P.2d 132 (Hames v. Rust) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hames v. Rust, 148 P.2d 132, 64 Cal. App. 2d 70, 1944 Cal. App. LEXIS 1023 (Cal. Ct. App. 1944).

Opinion

THE COURT.

This is an appeal by the plaintiffs from a judgment in favor of the defendant Deer Creek Union Mining Company a corporation.

On October 27, 1934, one George 0. Nihell executed to John A. Rust and S. W. Tull, a written lease and option to purchase two mining claims for the sum of $30,000, to be paid in specified monthly installments together with 10 per cent of all net proceeds derived from sales of ore extracted from the mines. The agreement was subsequently assigned by Rust and Tull to the respondent Deer Creek Union Mining Company on December 22, 1934.

Thereafter a series of events occurred as follows:

I. During the Pall of 1936, the time for the performance of the original agreement was extended.
2. On January 15, 1937, the defendant mining company was still in default of certain payments provided in said contract, and by a writing of that date Nihell waived such default “. . . till the financing program is completed. ...”
3. Regardless of the foregoing extensions of time and waiver, the owner, Nihell, on May 6, 1937, executed to plaintiff J. T. Hames, a. lease and option to purchase the claims on terms similar to those contained in the original lease to Rust and Tull. No mention was made therein concerning the agreement between Nihell and Rust and Tull dated October 27, 1934.
4. Again on June 19, 1937, Nihell waived in writing further default of the defendant company until “September 1, 1937.”
5. On June 21, 1937, Nihell executed another option to purchase the claims to plaintiffs J. T. and Jett A. Hames on similar terms, except that the purchase price was reduced to $20,000. This agreement was made subject to the October 27, 1934 agreement.
[72]*726. On the same date Nihell also executed to J. T. and Jett A. Hames an assignment of his interest in the original agreement of October 27, 1934, authorizing the assignees to collect the payments due thereunder.
7. On August 12, 1937, Nihell executed and delivered to the mining company a modification of the lease and option of October 27, 1934, whereby the balance due “before the 15th. day of November 1937” under the terms of said original agreement, was cancelled, and the monthly payments due thereafter were reduced.
8. Lastly, on October 29, 1937, Nihell executed a third option to purchase the mining claim to J. T. and Jett A. Hames, on substantially the same terms as expressed in the original lease.

The present suit was to quiet plaintiffs ’ title, and was commenced October 1, 1937, before the last mentioned instrument was executed, and a supplemental complaint was filed to cover the execution of the third option. The complaint alleged ownership in plaintiffs by virtue of the June 21, 1937 agreement, and for a second cause of action alleged default of defendants under the October 27, 1934 agreement between Nihell and defendants Rust and Tull.

The defendant Deer Creek Union Mining Company answered the complaint, denying the material allegations thereof, and affirmatively alleging that it held title to and possession of said mining claims, as assignee of the original lease and option to purchase the claims executed to Rust and Tull on October 27, 1934, and that said instrument was in full force and effect. It denied that the defendants were in default of any of the terms of that agreement, or that plaintiffs evér notified defendants of any default as required by the lease. The answer further alleged that the defendants fully performed all of the covenants of their lease and option to purchase; that they did not fail to operate the mines or to make payments as required by said agreement, and that on the contrary George A. Nihell and the plaintiffs waived any breach of covenants which might have occurred by modifying the contract in writing and by extending the times of payment thereunder. Finally it was alleged that plaintiffs had no right or title to said claims “superior” to those which were possessed by the mining company.

The defaults of defendants Rust and Tull were entered for [73]*73failure to answer the complaint.

The cause was tried twice. The first suit resulted in a judgment in favor of the defendant mining company. A new trial was granted on the ground of insufficiency of the evidence, and on appeal that order was affirmed. (Hames v. Rust, 14 Cal.2d 119 [92 P.2d. l010].) The case was then retried before the court sitting without a jury, and at the conclusion thereof findings favorable to the defendant corporation were adopted.

Pending the appeal of this case the plaintiff J. T. Hames died, and the administrator of his estate was duly substituted as a party plaintiff.

The appellants contend that the waiver of the breaches of contract and extensions of time within which to make stipulated payments were given without consideration; that while consideration is not always necessary, a waiver not supported by consideration may be retracted at any time unless conditions amounting to an estoppel exist; that plaintiffs’ notice of default on July 5, 1937, which was signed by plaintiffs and Nihell, gave defendants ample time to avoid a forfeiture, and that as defendants were already in default and could not have performed under the extension of time granted, there was no equitable reason why the extension could not be retracted without notice. It is further contended that the trial court erred in two of its findings. However, in view of the disposition of the other issues raised herein such contention becomes immaterial.

If, as the defendant corporation contends, Nihell was free to enter into the modification agreement of August 12, he could do so only if the June 19th agreement were valid, for obviously if the June 19th agreement were not valid, then the agreement on June 21st with the plaintiffs would control. It is necessary, therefore, to determine what rights, if any, were acquired by the two agreements last mentioned, those of June 19th and June 21st.

The record discloses what apparently was sufficient consideration for the granting of the extensions of time within which to pay the installments of money and to perform the covenants of the agreement. (Civ. Code, §1605; Lincoln Holding Corp. v. Levering, 219 Cal. 427 [27 P.2d 74]; Brownfield v. McFadden, 21 Cal.App.2d 208 [68 P.2d 993]; 6 Cal. [74]*74Jur. 168, §§ 117-118; 12 Am.Jur. 990, § 412.) In the authority last cited it is said in that regard:

“Any new agreement between the parties to an existing executory contract, made in substitution or modification of the elder compact and bilateral in benefit or burden, has, like the primary contract, a sufficient consideration in the mutual advantages or obligations which it confers or imposes. Where an agreement amounts to a waiver or discharge of mutual stipulations in a contract, either in whole or in part, the discharge of, each by the other from the obligations of the contract may furnish a sufficient consideration.”

Section 1605 of the Civil Code provides that:

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Bluebook (online)
148 P.2d 132, 64 Cal. App. 2d 70, 1944 Cal. App. LEXIS 1023, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hames-v-rust-calctapp-1944.