Staples v. May

23 P. 710, 3 Cal. Unrep. 250
CourtCalifornia Supreme Court
DecidedMarch 31, 1890
DocketNo. 12,167
StatusPublished
Cited by1 cases

This text of 23 P. 710 (Staples v. May) 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
Staples v. May, 23 P. 710, 3 Cal. Unrep. 250 (Cal. 1890).

Opinion

FOOTE, C.

This appeal is taken from a judgment in favor of the plaintiff, and from an order denying the defendant a new trial. From the record, it appears that Henry May was appointed the receiver of the property belonging to the Santa Clara Mining Association of Baltimore, whose lands and property were in the county of Santa Clara in this state; that the lands owned or possessed by this association contained mines o'f quicksilver; that the association was without means to work the mines, by which alone its then numerous debts could be paid; and that, to that end, May was authorized by the court which appointed him to borrow money, and use and expend it in working the mines, etc. He was originally appointed receiver in an action brought by the executors of the estate of W. S. O’Brien, deceased, to foreclose a mortgage on certain specific lands of the Santa Clara Association, and to foreclose a pledge of certain bonds secured by another and second mortgage or deed in trust. Afterward, when the beneficiaries under the deed in trust, who were made parties to the action originally, intervened and filed a cross-complaint seeking to foreclose their second mortgage or deed in trust, he was appointed receiver of all the property contained in both instruments, to carry on the quicksilver mines, borrow money, etc. There were other unsecured creditors, among whom was the plaintiff, Mary E. Staples, who could not get any satisfaction for their debts out of their debtor, the Santa [252]*252Clara Mining Association, by reason of its insolvency, and the existence of the instruments above mentioned. But she brought suit against the association, obtained her judgment, and, by proceedings supplementary to the execution issued on her judgment under section 720, Code of Civil Procedure, sought the aid of the superior court to force May, the receiver, to pay her what she claimed was due her debtor, the mining association, from May, as a trespasser, in realizing money from a mine of the Santa Clara Mining Association which was not included in either of the mortgages for which foreclosure had been prayed, and in which action May was, as before stated, appointed receiver. The court below held that May, as receiver, had gone upon the property of the Santa Clara Mining Association which was not included in either mortgage; that he was not authorized to do so as receiver under the appointment of the superior court; that he did so as a trespasser; and that the net profits which he had realized out of the working of the quicksilver mine upon which he had trespassed amounted to the sum of $38,212, for which and interest he became liable to pay to the Santa Clara Mining Association of Baltimore, the mortgagor in the two mortgages, amounting in the aggregate to the sum of $46,414.84; and, being liable to that corporation, the plaintiff “is entitled to judgment against defendant for such proportion of the sum of $46,414.84, as the amount of her said judgment and interest thereon to date, to wit, $6,593.19, bears to the said sum of $55,470.70, to wit, for the sum of $5,515, and costs of suit. ’ ’

The theory of the case on which the court seems to have made its findings and decision, and upon which it refused the motion for a new trial, is that the court never had any jurisdiction over the particular part of the Guadeloupe mine, the mining property of the Santa Clara Mining Association, from whence the quicksilver sold by the defendant was taken; that the receiver never had any authority to enter upon it: and that whatever sum of money resulted over and above the expenses of mining the quicksilver was an indebtedness of May, as a trespasser, to the Santa Clara Mining Association, for which he was individually responsible to them, and which, being an indebtedness accruing to them, was the subject of such proceedings as are here initiated, and he must [253]*253pay her share over to the plaintiff. This conclusion, it is contended by the appellant, is wrong, if the defendant is not justly indebted to the Santa Clara Mining Association, or if any such state of facts exists, as in equity and good conscience that association should not hold the defendant liable as trespasser; and it is urged that he should be held as one who, in the proper care of the other property of the association legally in his custody, was compelled to preserve that part of which he did have charge by the use of that of which he did not have control; thus benefiting the property of the Santa Clara Mining Association, increasing its value, and rendering it the more capable of paying the mortgage debts, and thus making it the more probable that the unsecured debts should be paid.

We think that the facts shown by the record are that, at the time of the first appointment of the receiver, all the mining property of the Santa Clara Mining Association was a part of the same system of operations; that it was all held as the mining ground, for the one common purpose of extracting quicksilver ore; that whatever quicksilver was extracted from one portion of the ground was used, indiscriminately, when sold and converted into money, for the common benefit of the whole property; that the association, being a party to these foreclosure proceedings, knew when the receiver was appointed that he would take charge of the whole property; that it was in such a condition that everything which could be gotten out of it, and every part of it, would be needed to preserve the property, and aid in paying its secured indebtedness; and that the receiver would use the whole of this property for that purpose. And, knowing all this, the mining corporation permitted him to take possession of all the property, to use it indiscriminately, to borrow money under the orders of the court, to carry on the whole mining industry, to work every part of it for the common benefit of the whole, never once protesting or objecting, but, apparently, willingly allowing all the benefit which accrued by virtue of the acts of the receiver to go to the enhancing of the value of its property, and standing by, not only without objection to, but, to all intents and purposes, approving his acts; and, so far as this record shows, the corporation is still satisfied with and acquiesces in the acts of the receiver with reference to its whole property. Those [254]*254who complain are persons to whom the mining association is indebted, and who cannot get their money unless they can show that, as a trespasser, the defendant did acts which the corporation considered a trespass, and not a benefit. The defendant, as receiver, has yet to repay many thousands of dollars of borrowed money used to develop and care for the property of the mining corporation, and borrowed under the authority of the court; yet the plaintiff claims that the proceeds of the quicksilver which the defendant extracted from one portion of the mine should go to her as the representative of the corporation whose property had been trespassed upon, and that the debts which he contracted under orders of the court, unobjected to by the mining corporation, and used to render more valuable its whole property, shall go unpaid from the proceeds of the corporation’s property which this borrowed money assisted to bring into existence. The defendant has benefited the mining corporation by all his acts.

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Bluebook (online)
23 P. 710, 3 Cal. Unrep. 250, Counsel Stack Legal Research, https://law.counselstack.com/opinion/staples-v-may-cal-1890.