Wheeler v. Floral Mill & Mining Co.

By the Court, Hawley, J.: Respondent is a corporation, and in this action claimed and obtained an offset of $1,000 against the mechanic’s lien sought to be foreclosed by appellants. The agreement under which the offset was claimed and allowed, reads as follows: “ Whereas it has been proposed to build a quartz mill at Pioche; Lincoln County, State of Nevada, (to be situated within the limits of said town of Pioche) the capacity of said mill being ten stamps with furnace, all complete in working order; and whereas, it is proposed to have the citizens of Pioche, [257] whether in their capacity as miners, mechanics, or others, to hold an interest in the ownership of said mill, it has been decided to receive subscriptions for the carrying out of the enterprise, in such manner and method as a majority of the subscribers hereto may elect; and whereas the sura of fifty thousand dollars in gold coin will be the utmost limit of amount of money desired for the enterprise, we, the undersigned, do hereby agree and promise to pay the several sums set against our names towards the amount desired, and in such manner and at such times as the majority of the undersigned may order. Pioche, May 30, 1873. Frank Wheeler & Co., - - - - $1,000.” This agreement was signed by sixteen others, and the subscriptions amounted in the aggregate to $35,000. It was not signed by respondent. It is apparent upon the face of this agreement that the subscribers were to have an interest in the mill; it was to be of the capacity of ten stamps; was to be built within the limits of the town of Pioche, and was not to cost over $50,000. The subscribers were to meet-after the subscriptions weré obtained and a majority were to elect the manner and method in which the proposed enterprise was to be carried out. It will be observed that appellants did not undertake to pay “The Floral Mill and Mining Company,” nor any particular person or corporation, the amount of their subscription. It was not a subscription for the benefit of another, but for the mutual benefit of all the subscribers. As a safeguard, it was provided that a majority of the subscribers should designate the manner, and direct the method, in which the enterprise was to be conducted. Whether they were to proceed by acts of incorporation, or otherwise, is not expressed in the agreement, and the respondent has failed to allege any fact connecting itself with the subscribers. The averment that appellants became subscribers [258] to the capital stock of respondent “by signing and delivering ” said agreement, is not a statement of any fact, but a mere conclusion of law. The only other averment in the answer tending to connect respondent with the subscribers, to wit, that “the majority of the said persons, who signed said agreement, ordered that the several sums therein specified and set against the names of the said signers should be paid to the said company (respondent) on demand” is insufficient. The answer fails to state what interest, if any, the appellants were to have in the property. It does, not give the capacity of the mill, nor state its cost; nor does it appear therefrom, that the majority of the subscribers ever decided the manner and method “ for the carrying out of the enterprise.” In fact, there are no averments in the answer sufficient to show any mutuality between appellants and respondent, or that the terms of the agreement have been complied with. Unless such facts are alleged and proved the respondent is not entitled to recover the amount of appellant’s subscription. Goff v. Winchester College, 6 Bush. Ky. 444; Machias Hotel Company v. Coyle, 35 Maine 410; Atlantic Cotton Mills v. Abbott, 9 Cush. 425; Dalrymple v. Lanman, 23 Md. 399; Berry v. Yates, 24 Barb. 202. The court found as a fact, that the offset pleaded by respondent was a “proper matter of offset;” but we cannot presume that this fact was properly found, because there were no averments in the answer to base such a finding upon. Barron v. Frink, 30 Cal. 489; Burnett v. Stearns, 33 Cal. 473. The judgment, allowing the offset of $1,000, is reversed and the cause remanded for a new trial.