McShane v. Carter

22 P. 178, 80 Cal. 310, 1889 Cal. LEXIS 909
CourtCalifornia Supreme Court
DecidedSeptember 3, 1889
DocketNo. 12578
StatusPublished
Cited by27 cases

This text of 22 P. 178 (McShane v. Carter) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McShane v. Carter, 22 P. 178, 80 Cal. 310, 1889 Cal. LEXIS 909 (Cal. 1889).

Opinion

Hayne, C.

This was a suit to enjoin the defendant Carter, who is a sheriff, from selling the property of the plaintiff under a judgment obtained by the defendant [311]*311Smith against the Nevada Reservoir Ditch Company, from which plaintiff deraigned his title. The property which the sheriff was proceeding to sell is described in the complaint as follows, viz.:—.

“That certain reservoir ditch, sometimes called the big ditch, having its head about one half mile above the residence of Joseph Perrin, on Little Wolf Creek, in Grass Valley township, Nevada County, state of California, and extending thence westerly to the west line of Nevada County; and also that certain water right, being the right to take the waters of said Wolf Creek, and divert the same from said creek to the extent of the capacity of said ditch.”

The plaintiff alleges that he was the owner of several mining claims described in the complaint, and that ‘?said property advertised for sale and levied upon under said execution has been for years past and now is by plaintiff used as appurtenant to said mining claims and reservoirs and mining lands of plaintiff, and is necessary and requisite to the working and operating thereof, cmd was and is appurtenant thereto.”- And this was found to be the fact, both as to the plaintiff himself and as to his predecessors in interest.

■ In the plaintiff’s chain of title to the claims and ditch were two deeds from mining corporations, viz., a deed from said Nevada Reservoir Ditch Company to the Golden Gate Consolidated Mining Company, made in 1882, and a deed from the latter to one Patrick Campbell, made in 1884. These deeds were authorized by the boards of directors of said respective companies, and were executed by the proper officers, but were not ratified by the stockholders of said corporations.

In 1880 the legislature passed an act entitled “An act for the further protection of stockholders in mining companies,” which contained the following provision:—

“Sec. 1. It shall not be lawful for the directors of any mining corporation to sell, lease, mortgage, or otherwise [312]*312dispose of the whole or any part of the mining ground owned or held by such corporation, nor to purchase or obtain in any way any additional mining ground, unless such act be ratified by the holders of at least two thirds of the capital stock of such corporation. Such ratification may be made either in writing, signed and acknowledged by such stockholders, or by resolution duly passed at a stockholders’ meeting called for that purpose.” (Laws of 1880, p. 131.)

The court below gave judgment for the plaintiff, and the defendants appeal from said judgment, and from an order denying their motion for a new trial. The appeal from the judgment was taken too late, and must for that reason be dismissed. The appeal from the order denying the motion for a new trial, however, is properly presented. (Pico v. Cohn, 78 Cal. 384.) And the important question arising on that appeal is, whether the evidence is sufficient to show that the plaintiff was the owner of the property which the sheriff was proceeding to sell; and this depends upon whether the directors of said mining companies had power or authority to convey the property in the absence of a ratification by the stockholders as specified in the act of 1880.

1. We think that the provision of said act goes to the power or authority of the directors. It cannot be construed to relate merely to their personal liability, for no penalty is imposed upon them; and to so construe it would be to practically nullify the act. In our opinion, the directors of mining corporations have no power or authority to convey the mining ground without the consent of holders of two thirds of the stock, given as prescribed by the act. And it follows without such consent the title does not pass. And if this be so, the question | can be raised by any one who connects himself with the I title of the corporation which owned the property, as Well as by the stockholders thereof.

Nor can the consent of the stockholders be presumed [313]*313from the mere fact of the conveyance, whether under the corporate seal or not, for such consent or “ratification ” may be after the deed is executed, and hence is not necessarily or presumptively involved in the execution of such deed.

2. Is the property in controversy here within the purview of the act ? It is to be observed that the requirement relates to “the mining ground.” Just what that term includes might perhaps admit of question in certain cases. Does it include only the ground actually mineralized? or does it embrace all the other adjacent lands of the corporation ? It is not necessary to consider that precise question in this case. But we think that whatever realty is incident or appurtenant to the mineralized ground worked as a mine—whatever would pass by a conveyance of “the mine” itself as an appurtenance thereto—is within the meaning of the requirement. The transfer of a thing transfers all its incidents and appurtenances. (Civ. Code, sec. 1084.) So that the question is, whether a ditch and water right by means of which “mining ground” is operated and used is an incident or appurtenance thereof.

In' this regard it is to be remembered that the court finds that the ditch and water right were appurtenant to the mines formerly owned by said corporations, and purported to have been conveyed by them, and necessary to the use and operation thereof. And we think that this finding is in accordance with correct principles. The relation of a mine to the water by which it is operated is analagous to the relation between an ordinary mill and the water upon which its use depends.

Water is as essential to the use of the one as it is to the use of the other. And it is well settled with reference to ordinary mills that the water right is appurtenant to the mill, and will pass by a conveyance thereof, either with or without express mention of “the appurtenances.” This has been the law from early periods.

[314]*314In Touchstone it is laid down that “by the grant of mills, the waters, flood-gates, and the like, that are of necessary use to the mills, do pass.” (Shep. Touch. 89.) And in the old case of Nicholas v. Chamberlain, Cro. Jac. 121, “ it was held by all the court upon demurrer that if one erect a house, and build a conduit thereto in another part of his land, and convey water by pipes to the house, and' afterwards sell the house with the appurtenances, excepting the land, or sell the land to another, reserving to himself the house, the conduit and the pipes pass with the house, because they are necessary and appurtenant thereto.” Chancellor Kent says: “ A conduit conveying water to the lands sold from another part of the lands of the. grantor will pass as being necessary or quasi appurtenant thereto. So a raceway conducting water from a mill to another part of the grantor’s land has been held to pass by a conveyance of.land with the mill thereon.” (4 Kent’s Com. 467.) And in Richardson v. Bigelow,

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Bluebook (online)
22 P. 178, 80 Cal. 310, 1889 Cal. LEXIS 909, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mcshane-v-carter-cal-1889.