A contract to

§ 270. Contract to test for mineral. test for mineral, although it does not create an estate in the promisee, either in regard to the land,1 or the minerals mined thereunder,2 unless otherwise limited, transfers to the promisee the absolute right to mine the premises to which his operations are confined, and gives him a right of action against any third party who should enter under a subsequent contract with the mine owner and interfere with his operations.3 If the contractor obliges himself to mine so much within a certain time, or to prospect to a certain depth,5 he will not be relieved from his covenant on account of the particular hardships that would result to him by a compliance therewith, but will be compelled to perform his contract, if in the realm of possibility, although he would have the right to abandon the same after all indications of valuable ore had ceased,7 provided he could show that a compliance with the contract would not lead to the discovery of such ore.8 But where the contractor is to mine at his own expense, so long as he can profitably work the minerals, he is not compelled to mine when his operations cease to be of profit, although he would forfeit his rights if he should cease work for an un

1 Shaw v. Wallace, 1 Dutch. (N. J.) 453.

2 Granby M. & S. Co. v. Turley, 61 Mo. 375.

3 Shaw v. Wallace, supra; Austin v. Coal Co., 72 Mo. 535; Kirk v. Mattier, 140 Mo. 23.

4 Neldon v. Smith, 36 N. J. L. 148; Beninger v. Hankee, 61 Pa. St. 343; Cook v. Andrews, 36 Ohio, 174.

5 Woodworth v. McLean, 97 Mo. 325. In the absence of a custom or an express agreement the contractor is not bound to timber the mine. No. 5 Min. Co. v. Bruce, 4 Colo, 293.

• Pollock on Con. 349; Chitty on Con. 1070-1076; Woodworth v. McLean, supra.

325.

Cook v. Andrews, 36 Ohio St. 174; Woodworth v. McLean, 97 Mo.

8 Ante, idem, as to burden of proof.

9 Adams v. Orknob Copper Co., 7 Fed. Rep. 634.

reasonable time,1 and where the mine owner himself furnishes the contractor the tools and means of prospecting, the latter is, not responsible for any damage resulting to the mine owner, if he has himself used reasonable diligence in the prosecution of his operations and such as a reasonably prudent man would exercise in the use of the same tools and appliances.2

§ 271. Contract to drain mines. The same rules of construction govern contracts to drain mining land that applies in the case of contracts to test for minerals, and where the contractor obligates himself unqualifiedly to drain certain mines, or a section of land, if the contract is indivisible he would not be permitted to recover on the same where he failed to drain the entire tract, even though his failure to drain the remainder of the tract was a physical impossibility. He should have stipulated against the impossible in his contract and if he fails to do so, having, by his own act, assumed the undertaking, he is held to a full discharge of the duty created by the contract, notwithstanding his failure to comply with the covenant resulted from inevitable necessity. But where by the contract the

3

1 Ante, idem. "The 'test' required by a mining lease is such as will discover, not only the presence of minerals if they exist, but their commercial value, considering their abundance and accessibilty." Petroleum Co. v. Coal, C. & Mfg. Co., 89 Tenn. 381.

2 Campbell v. Gates, 10 Pa. St. 483. "A company owning a quartzledge having contracted for the running of a tunnel to cut the same, promised the plaintiff to pay for provisions to be furnished the tunnel contractor, in case the contractor failed to reach the ledge, is bound upon such promise to pay, the tunnel being abandoned without reaching the lode." Van Dusen v. Star Q. M. Co., 36 Cal. 571; M. M. D. 39. See for construction of prospecting contract, North Geo. M. Co. v. Latimer, 51 Ga. 67.

3 Brinkerhoff v. Elliott, 43 M. A. 185; Nichols v. Larkin, 79 Mo. 264. 4 Brinkerhoff v. Elliott, supra; 2 Pars. Con. (5 Ed.) 520; McDermott v. Jones, 2 Wall. 1-7; Earp v. Taylor, 73 Mo. 619; Bishop on Con., §§ 577

contractor has stipulated against the performance of the impossible, or does not agree, unqualifiedly, to drain all the tract, he would not be precluded from a recovery where he had failed to perform his entire contract, if the failure resulted either from unavoidable accident or the act of the mine owner, but would be allowed a reasonable compensation for the work done, according to the contract price,1 and where the contract limits the contractor's duty to the drainage of the mine in its condition at the date of the contract, he could not be charged with any greater duty, but if the mine owner, in sinking, should develop a stronger vein of water, he would be relieved from a performance of the contract.2

§ 272. Construction aided by custom. Where the rights of the parties to a mining contract are not clearly settled by the terms thereof, it is competent for the court in construing such contract, to determine the rights of the parties thereto, according to the construction that they have themselves placed upon the contract, and their own usage or acts under the contract is competent evidence to show the true intention had in view at the time of the making of the contract, and it is competent to introduce the custom

609; Davis v. Smith, 15 Mo. 467; Jemison v. McDaniel, 25 Miss. 83. But for equitable doctrine, where contracting party is not in default, see Bisp. Pr. Eq., § 183, p. 239; Story Eq. Jur., § 90 et sub.

1 Where failure to perform results from "act of God," see Bishop on Con., §§ 577–609; Lakeman v. Pollard, 43 Me. 463. For the rule, laid down by the old cases, where party fails to stipulate against the impossible, see Bishop on Con., § 590, p. 232. For equitable doctrine, see Bisp. Pr. Eq., supra. See Bishop on Con., § 143, for rule where breach results from obstruction of opposite party. See also St. Louis v. McDonald, 10 Mo. 609.

2 Pringle v. Taylor, 2 Taunt. 150.

3 Leoners v. Cleary, 75 Ill. 349; Coleman v. Grubb, 23 Pa. St. 393; Cook v. Andrews, 36 Ohio St. 174; Randolph v. Horden, 44 Iowa, 328.

in force where the contract was made to explain the force and effect to be given to ambiguous words used, as also to explain the intention of the parties from the language used.1 It has been said that the parties are always presumed to contract with reference to the general custom or usage in force where the contract was entered into,2 and it is well settled that a custom can be introduced to explain ambiguous words in the contract, as well as to control the rights of the parties on matters where the contract is silent.3 But a custom is not permitted to govern the rights of the parties as against the expressed agreement of the parties,4 nor could it be introduced to restrict the contract of the parties, so where the custom is adverse to the rights created by the contract from the language used, or where it is in opposition to the established rules of law,6 it could not be introduced by either party to govern in the construction of the contract.7

"Where the terms of an agreement respecting joint ownership of ore beds were doubtful, the usage of the parties in taking ore for their respective furnaces, would be an important element in their construction." Coleman v. Grubb, 23 Pa. St. 393; M. M. D. 37.

1 Desloge et al v. Pearce, 38 Mo. 588; Rogers v. Brenton, 10 Q. B. 26; Collier on Mines, pp. 22-41; Bainb. Mines, pp. 456-468; McGarrity v. Byington, 12 Cal. 427; Wilcox v. Wood, 9 Wend. 349; Stultz v. Dickey, 5 Binn. 285; Gleason v. Walsh, 43 Me. 397.

2 Bortin v. McKelway, 2 Zab. 175; Lantier v. Kellerman, 18 Mo. 509; Morin v. Hall, 26 Mo. 386.

3 Desloge v. Pearce, supra, and cases cited.

4 Shafto v. Johnson, 8 B. & S. 252; Randolph v. Hardin, 44 Iowa, 328.

5 Randolph v. Hardin, supra; Desloge v. Pearce.

6 Fritch v. Barker, 2 Johns. 335; Homer v. Dorr, 10 Mass. 29. Ante, idem. Woodworth v. McLean, 97 Mo. 325; Oreknob Copper Co. v. Adams, 7 Fed. Rep. 634; No. 5 Min. Co. v. Bruce, 4 Colo. 293.

CHAPTER XVIII.

MORTGAGES OF MINES.

SECTION 273. Mortgagee may work mine. 274. Cannot open new mines.

275. Accounting by mortgagee.

276. Mortgagor can continue to mine.
277. Mortgage by mining corporation.
278. Mortgage by partnership.

279. Conflicts with other liens.

280. Fixtures annexed to mortgaged premises.
281. Effect of subsequent lease.

282. Deed intended for mortgage.

§ 273. Mortgagee may work mine. — A mortgagee who has entered into possession of the mortgaged premises may lawfully work a mine located thereon, provided he applies the proceeds therefrom upon the mortgage debt.1 Such use of the property, by the mortgagee, could not be treated as waste, by the mortgagor,2 for although the mining would impair the value of the property, it is but putting it to the natural use to which it is adapted. quarry can also be operated by a mortgagee, in possession, and the mortgagor could not enjoin such use of the premises.3 A mortgagee would be held to a strict account of all proceeds of ore realized, however;4 he could not

1 Irvin v. Davidson, 3 Ired Eq. (N. Car.) 311.

2 Capnor v. Flemington Min. Co., 2 Gr. Ch. (N. J.) 467.

A

3 Vervalen v. Older, 4 Halst. N. J. Ch. 98. "The proper use of a quarry cannot be considered waste, and will not be enjoined in favor of a mortgagee, and especially of a mortgagee who had himself sold the premises to the mortgagor as a quarry lot." Vervalen v. Older, 4 Halst. N. J. Ch. 98; M. M. D. 240. Mortgagee, however, could not work at all, if premises are of value sufficient to pay the mortgage debt. Millett v. Davy, 31 Beav. 470.

4 A mortgage embracing all personal property of mortgagor, does not