Gilmore v. . the Ontario Iron Company

Folger, Ch. J. By the terms of the agreement the defendant was to pay the plaintiff for the use of the premises twenty cents for each ton of ore mined. That the defendant should not let the lands lie idle, and thus the plaintiff have no profit from them, he exacted and it agreed that it would mine *458 at least eight thousand tons each year; and that the plaintiff •should realize the full value of the mineral deposit on his land, he exacted and the defendant covenanted to mine all the ore on the land. In effect, this was an agreement to pay to the plaintiff at least $1,600 each year for the right to mine and remove the ore, and for so many years as it took to take it all out. But perceiving that there was a risk that the veins of ore might be so thin that the expense of mining it might be more than it was worth when mined, the defendant exacted and the plaintiff agreed that the covenant to take out all the ore • was limited to all the ore that was in veins of not less than fifteen inches, and where the veins were less than that thickness it was to be at the option of the defendant to mine it or not. The effect of this was that the defendant was bound absolutely to take out all the ore where it lay in a vein of fifteen inches or more, and was bound to take it all out where it lay in veins less thick than that, unless it used the option given to it not to do so. Under that agreement the defendant entered into the lands, and has kept possession of them ever since making entry. It has not mined all the ore from them, nor the eight thousand tons per year, nor has it fully paid the plaintiff the stipulated royalty, nor has it used the option and made lmown to the plaintiff that it purposed to use it. How if there is a vein there of the desirable thickness, it is bound to work it to exhaustion. If there is not such a vein, there, it is still bound to work what there is, or to use its option and to let the plaintiff know that it does, or to give him back the lands, that he may get what profit he can from them. True, the agreement of the defendant is subject to a contingency, but it is not' a contingency that is in the hand of the plaintiff. He has no power to put an end to the contract. Though there be no vein of the looked-for thickness, the defendant has yet the right to work what there is. The contingency is in the hand of the defendant. It must either apply it to be relieved from its covenant, or it must perform the covenant it has entered into. Hor is the position correct, that the defendant should pay for only so much as it actually took out. The price reserved for the *459 right to mine is, in some sort, fluctuating, but not below the sum that twenty cents per ton for eight thousand tons will produce. Nor was the minimum price affected by the instrument given by the plaintiff subsequent to the agreement. That contemplated a delay in commencing the work of mining, and a failure to get out the looked-for quantity when the mining operations had exhausted the land of ore. The facts do not yet exist that call upon the plaintiff to make performance of that subsequent agreement. If the failure of the defendant to mine the stipulated quantity came from the vein being less than the. thickness named, it was a matter of which it had the option to avail itself or not. The use of the option in that case would have been a good answer to a demand for the royalty on the stipulated quantity. The option not having.been exercised, the defendant still having the possession and use of the ■land, and the royalty unpaid,' there is but one answer it can make, and that is, that the land has been exhausted of ore. Nor is the position sound that, because practically the agreement was not so much for the use of the plaintiff’s property as for the property itself, inasmuch as when the ore was mined it was no longer the plaintiff’s property, but that of the defendant ; the plaintiff, not having in fact yet parted "with his property, ought not to have pay for it. The defendant, for aught that appears, may yet go on and .take away the property, or may have done so. The agreement, by its terms, was to run so long as was needed to enable the defendant to take out all the ore. It does not appear that the agreement has ever been ended. But the unsoundness of the position goes deeper than that. It would be no answer to a demand for rent of agricultural lands, that the tenant had let the land lie idle, and that all the elements of productiveness still lay in the soil unused; 'that those were what the tenant had bargained for, and they were yet there for the landlord. They are of value to the landlord only when used. He uses them in effect from year to year, through the tenant, and gets his profit from the use in the rent he receives. So here, the ore gives no return until *460 dug out and marketed. The plaintiffs method of doing this was to let the privilege of mining to the defendant, and reserving a portion of the profit in the royalty stipulated for. It may have been, it probably was, the most profitable method for him to adopt to make gain from his ore. Though the ore may remain and not be lost to him, time has been lost to him in the process of having it turned into money. He has lost the enjoyment of the fruits of his property. He has lost the use of the surface of his lands. He has failed to realize the profitable results he looked for, and had a right to look for, from the bargain he made. The judgment should be affirmed. AH concur, except Miller, J.. not voting. Judgment affirmed.