Hawkins v. . Pepper

Avery, J.: It is a well settled principle that where an estate or interest in land is conveyed for a nominal consideration and is subject to be defeated by failure to perform a condition subsequent which constitutes the consideration on the part of the grantor for executing the deed conveying it, a reasonable time will be allowed for its performance, after which th'e courts will adjudge that the grantee, if he has taken no steps looking to and giving promise of a compliance with it, has abandoned the purpose to perform it. Ross v. Tremaine, 2 Met., (Mass.) 495; Allen v. Howe, 105 Mass., 241; 6 Am. & Eng. Ene., p. 903, note 1; 2 Washburne (5th Ed.) p. 12, star pp, 449, 450; Austin v. Cambridgeport Parish, 21 Pick. (Mass.) 215. It is familiar- learning that certain apt words will always *413 be construed to create a condition subsequent. But ‘deeds and leases are contracts and that before us for interpretation contains mutual stipulations and is signed by both of the parties to it. A contract may be construed by looking to all parts of the instrument embodying it, in order to ascertain whether the parties intended to create such conditions, though they may have failed to use the apt words usually employed. 2 Washburne R. P., p. 27, star p. 459 ; 1 Wood on L. & T., Sec. 233, p. 502; 5 Lawson’s Rights & Rem., Sec. 2511. Though neither the words “on condition,’’ “provided always,” “if it shall' so happen” nor-other equivalent expressions appear in the instrument, and though no clause of re-entry be inserted and yet it appears “that the performance or non-performance of an act named is the only consideration or inducement for executing the deed, it should ordinarily be construed as a condition.” 6 Lawson’s R. & R., See. 2760, p 4499; Railroad Co. v. Hood, 66 Indiana, 580, cases cited, p. 585. The agreement which gives rise to the controversy, recites in the first paragraph a nominal consideration for conveying the mineral interest in a certain tract of land with rights of ingress and egress, to work the same and to-use “any timber or other material thereon to fit the same for market, ”&c. The grantor adds at the conclusion of the stipulations that “the said N. M. Pepper (the grantee) his heirs or assigns, shall havefull power to convey to other party or parties.” The agreement on the part of the defendant .Pepper is as follows : “For the consideration aforesaid, the said N. M. Pepper agrees to make, or cause to be made, examination of the aforesaid lands, and if any valuable minerals are found, shall pay the said James Hawkins one-half of the net amount he may receive for the said minerals or metals; or, in case the said N. M. Pepper shall convey the rights and privileges hereby granted to *414 other "party or parties, then and in that case, he, the said N. M. Pepper, shall pay the party of the first part two hundred dollars, and in addition thereto shall pay the said party of the first part one half the remainder of the net amount he may receive for the said minerals and privileges, after deducting the expense of developing the same, erecting machinery,” etc. The defendant contends that the instrument is to be construed as an absolute deed to the fee simple in the mineral interest; but if the parties intended that the agreement should operate as an indefeasible conveyance, it is difficult to conceive why the power to convey should be given, as a conclusion to the mutual stipulation of the plaintiff, to one, who was already the absolute owner of the interest which he was empowered to alien. This provision is utterly irreconcilable with any other mutual understanding, but that the title was conveyed to the defendant in order that, after working it, and paying over the royalty agreed upon (one-lialf the net amount received for minerals sold) the said N. M. Pepper should be empowered to sell the developed mine upon paying two hundred dollars, and in addition one-half of the net proceeds of the sale to the plaintiff. If the contention of defendant’s counsel is correct, Pepper has aquired the absolute right to the mineral interest in the land for a mere nominal consideration, while his covenant to pay half the net proceeds of minerals taken out or of a sale of the whole interest is- a mere personal covenant to be performed whenever he or his heirs may see fit to work the mine, or develop and sell it. In Maxwell v. Todd, 112 N. C., 678, the operative words in the instrument construed to be a lease forfeitable for non user, were “hereby leases and by these presents does grant aud convey to the said parties of the second part their heirs, executors administrators and assigns.” *415 The term was declared to be 99 years, the .object mining for minerals, the royalty one-tenth of the net proceeds of all minerals taken out, and the consideration as in this case one dollar. It was held there that the instrument should be construed as though a clause of defeasance or forfeiture had been expressly embodied in the deed. The same principle is declared applicable to mining leases in Conrad v. Morehead, 89 N. C., 31. We conclude that there was manifestly no intent to vest in the defendant Pepper an absolute and indefeasible estate for the nominal consideration, but that it was the muta! understanding that the fee should pass to him for the temporary purpose of selling within a reasonable time, and that meantime there was an implied condition attached that he should not abandon the woi-k of opening and developing the mine, so that it should be fitted for active operations by Pepper or for examination with a view to purchase by others. The performance of the agreement to open the mine and prepare it for sale was the only inducement to convey, and the facts bring the case within the just principle already stated. The failure by Pepper, according to his own testimony, to work the mine for the years 1886 to 1894 operated in contemplation of law as a forfeiture of his rights under the contract, just as though an express provision had been inserted in it that he should forfeit all rights acquired under it if his running operations should be abandoned for a reasonable time. When his rights were once so lost, it was not necessary for the plaintiff to re-enter, since the estate had vested in Pepper for a particular pur-' pose which appeared upon the face of the instrument, and not subject only to the preformance of an act to be done dehors, which should give the right of re-entry and render it necessary to assert the claim to the forfeiture by some such public act. *416 There was no error in the instruction given to the jury, in effect, that in any aspect of the evidence the rights acquired by Pepper under the deed had been forfeited. Affirmed.