United Mining Co. v. Morton

192 S.W. 79, 174 Ky. 366, 1917 Ky. LEXIS 190
CourtCourt of Appeals of Kentucky
DecidedMarch 2, 1917
StatusPublished
Cited by13 cases

This text of 192 S.W. 79 (United Mining Co. v. Morton) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United Mining Co. v. Morton, 192 S.W. 79, 174 Ky. 366, 1917 Ky. LEXIS 190 (Ky. Ct. App. 1917).

Opinion

Opinion of the Court by

Judge Miller

Reversing.

This suit by the appellee, Morton, against appellant, grew ont of a partnership transaction between Morton and Edward Langenbach.

Late in 1899, Edward Langenbach and Arthur J. Morton, residents of Canton, Ohio, orally formed an equal partnership for the purpose of taking mineral [367]*367options and leases, and acquiring and developing mineral rights and holdings in Livingston and Crittenden counties, Ky. By the terms of the partnership, Morton agreed to go into the mineral fields of western Kentucky and devote his whole time in prospecting, exploring, and doing other necessary work and labor in furthering the interests of the partnership, and Langenbach was to pay all expenses, including the purchase price, in acquiring the leases and in the development thereof.

Morton proceeded to Kentucky .and procured quite a number of leases, including one known as the “Mann Mineral Lease,” in Livingston county, dated May 22, 1900. It was agreed that the firm name and style should be “Langenbach & Morton,” and all the leases acquired by Morton should be, and they were taken, to the firm.

Shortly thereafter, Langenbach and Morton organized an Ohio corporation, known as the American Lead, Zinc & Fluor Spar Company, and to that corporation they sold all of their mineral leases and options that were considered of any value, except the Mann lease, which they retained as the property of the firm. The capital stock of the American Lead, Zinc & Fluor Spar Company was issued to Langenbach and Morton, equally, in exchange for the mineral rights and holdings which they had turned over to that corporation; and, it may now be dismissed from further mention, except to say that for two years or more Morton gave his time and attention to the development of the properties of that company.

.Morton had done some prospecting on 'the Mann lease, sufficient to discover a vein or body of carbonate of zinc; but before they were able to mine any of the zinc, litigation with subsequent lessees of Mann, over the Mann lease, was begun in the Livingston circuit court and removed to the federal court, which was not finally determined until June, 1910. By the final judgment entered on June 9, 1910, in the federal court, the claim of Langenbach and Morton as owners of the Mann lease, was established.

While Morton remained in Livingston county in the service of the American Lead, Zinc & Fluor Spar Company, he gave such assistance as was necessary in the litigation about the Mann lease. But, long before the litigation was terminated,, he returned to Canton; and, from there he went to Chattanooga, Tennessee, in 1908, where he engaged in business.

[368]*368In the meantime, Edward Langenbaoh was paying the costs of the litigation, including attorney’s fees, and other necessary expenses. Morton had not only ceased to- give the business any attention whatever, but had left the state.

Morton’s presence being necessary in Kentucky in 1908 in connection with the litigation, Langenbach’s attorney wrote Morton, at Chattanooga, requesting him to go to Paducah; whereupon, Morton notified Langenbach that he would not attend unless Langenbach would send him $50.00 for his expenses and time. Langenbach sent Morton the $50.00 requested, and Morton went to Paducah. The federal court decided the case in favor of Langenbach and Morton in April or May, 1909; but, owing to the death of C. S. Knight, one of the litigants adverse to Langenbach and Morton, it became necessary to revive the action against his heirs, and take some additional proof as to the possession of a small part of the tract, before a final judgment could be entered. On account of this delay, the-final judgment was not entered until June 9, 1910. However, when the opinion in favor of Langenbach and Morton was handed down in 1909, Morton, who was then living at Chattanooga, Tenn., wrote to Langenbach at Canton, Ohio, as follows:

“I presume Mr. Grassham notified you he won the Mann suit, and g*ave you the particulars. If not, I will. ’ ’

In 1910, however, Morton departed from Chattanoog'a and settled at some place in the west. He did not notify Langenbach where he was located; and Langenbach did not see him again until his reappearance in Canton in May, 1913, after an absence from Kentucky of about five years.

In the meantime, their' attorneys in Kentucky had notified Langenbach that under the terms of the lease, work should be begun upon the property in order' to hold it. Thereupon, Edward Langenbach undertook to develop the property and preserve the lease. In doing this he employed his brother, William Langenbach, to superintend the work. Under this employment, William Langenbach came to Kentucky and operated the mine from June, 1910, to August, 1911, during which time he mined and shipped 357% tons of ore, which were sold for $8,185.73. The expense, however,- of mining this 357% tons of ore was about $12,000.00, while the other expenses, including the cost of machinery, carried [369]*369the total expense to $18,000.00, maMng a total loss upon this feature of the enterprise, of nearly $10,000.00. Edward Langenhach was unwilling to put any more money into the venture, and stopped operations.

In the meantime, W. H. Mann, the owner of the leased land, had sold it to C. S. Knight; and upon Knight’s failure to pay the deferred payments of his purchase money, Mann enforced his vendor’s lien, in 1911. At the commissioner’s sale, William Langenhach bought the land, subject tq the lease of Edward Langenbach and Morton.

By its terms, the Mann lease was to continue “for and during a- term of ten years from the date thereof, and so long thereafter as metals, oil, or gas can be produced in paying quantities.” The judgment of the federal court by which Langenhach and Morton’s lease was established, extended the lease for seven years, because of the failure of Mann to give them undisputed posses-ion during the period of litigation. The Mann lease contained this further provision:

“The second parties, their heirs or assigns, shall have the right at .any time to surrender up this lease and' be released from moneys due and conditions not fulfilled ; then and from that time this lease and agreement shall be null and void, and be no longer binding upon either party, and the payments, which shall have been made, be held by the party of the first part as the full stipulated damages for non-fulfillment of the foregoing contract.”

The lease further required Langenhach and Morton to commence operations within ninety days from the execution of the lease, or in lieu thereof they should thereafter pay rent to Mann at the rate of $100.00 per annum; otherwise, the lease was subject to forfeiture.

When Edward Langenhach decided to discontinue operating the mine after his loss of about $10,000.00, as above recited, William Langenhach, who, as the owner of the land under his purchase at the commissioner’s sale had acquired all of the rights of W. H. Mann under •the lease, notified his brother, ’ Edward, that he must continue operating the mine or surrender it, under the provisions of the lease above given; whereupon Edward Langenhach declined to proceed further with the mining operations, and orally surrendered the lease to Wm. Langenhach, under the provisions thereof, above given.

[370]

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Bluebook (online)
192 S.W. 79, 174 Ky. 366, 1917 Ky. LEXIS 190, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-mining-co-v-morton-kyctapp-1917.