Mont.) BAILEY v. TINTINGER There may be lands available for irrigation In the note to Nevada Ditch Co. v. Ben- To deny the right of a public service corporation to make an appropriation independently of its present or future customers, and to have a definite time fixed at which its right attaches, would be to discourage the formation of such corporations and greatly retard the reclamation of arid lands in localities where the magnitude of the undertaking is too great for individual enterprise, if, indeed, it would not defeat the object and purpose of the United States in its great reclamation projects, for the United States must proceed in making appropriations of water (from the nonnavigable streams of this state at least) as a corporation or individual. Section 4846. Rev. Codes; United States v. Burley (C. C.) 172 Fed. 615; Burley v. United States, 179 Fed. 1, 102 C. C. A. 429. 583 It is clearly the public policy of this state to encourage these public service corporations in their irrigation enterprises, and the courts should be reluctant to reach a conclusion which would militate against that policy. [8] It is impossible to harmonize the decisions of the courts upon the subjects presented. Respectable authority can be found holding contrary to our view; but upon a consideration of our statutes, the history of the law of appropriation, and the public policy of this state, we base our conclusion that, as to a public service corporation, its appropriation is complete when it has fully complied with the statute and has its distributing system completed and is ready and The right thus willing to deliver water to users upon demand, and offer to do so. obtained may be lost by abandonment or nonuser for an unreasonable time (1 Wiel, § 569), but cannot be made to depend for its existence in the first instance upon the The appellant here is a voluntary acts of third parties-strangers to its undertaking. public service corporation (State ex rel. Milsted v. Butte City W. Co., 18 Mont. 199, 44 Pac. 966, 32 L. R. A. 697, 56 Am. St. Rep. 575; Gutierres v. Albuquerque L. & I. Co., 188 U. S. 545, 23 Sup. Ct. 338, 47 L. Ed. 588; 2 Wiel, § 1260), as were its immediate predecessors, while the original appropriators of the right claimed by appellant were private individuals. [9] If our statute does not by express terms, it does by fair implication, require that, at the time of taking the initial steps, the claimant must have an intention to apply the water to a useful or beneficial purpose. Power v. Switzer, 21 Mont. 523, 55 Pac. 32; Toohey v. Campbell, above; Miles v. Butte Electric & Power Co., above; Smith v. Duff, above. The law will not encourage any one to play the part of the dog in the manger, and therefore the intention must be bona fide and not a mere afterthought. Nevada County & S. C. Co. v. Kidd, 37 Cal. 282. [10] The appropriator's need and facilities, if equal, measure the extent of his appropriation. Sayre v. Johnson, 33 Mont. 15, 81 If his needs exceed the capacity Pac. 389. of his means of diversion, then the capacity of ditch, etc., measures the extent of his right. McDonald v. Lannen, 19 Mont. 78, 47 Pac. 648. If the capacity of his ditch exceeds his needs, then his needs measure the limit of his appropriation. Toohey v. Campbell, above. We find, then, from this record that, at the time of the initiation of appellant's right in 1892, there was a useful and beneficial purpose to which the water to be appropriated could be applied; that Lee, Hall, and Hatch were qualified to make an appropriation; that they had the bona fide intention at the time to apply the water, which they sought to appropriate, to a useful and beneficial purpose; that they posted the required no Cent. Dig. §§ 249-252; Dec. Dig. § 122.*] TION-SUFFICIENCY. In an action on a note, where the answer denies any knowledge or information sufficient to form a belief as to nonpayment by a joint maker, judgment for plaintiff on the pleadings is improper; a denial in this form being expressly authorized by Rev. Codes, § 6540, and being sufficient to raise an issue. tice at the point of diversion, filed the no- | presented to and allowed by her, are frivolous, tice with the county clerk and recorder with- since these facts could be ascertained from the public records. in the time required by law, commenced the work of constructing the canal by which the water was to be diverted, within the period limited by the statute; that they and their successor, the Holland Irrigation & Canal Company, prosecuted the work with reasonable diligence and completed it by 1895 or 1896, which, considering the magnitude of the undertaking, was within a reasonable time; that the notice posted and the one filed for record claimed more than 2,200 inches; that the canal, when completed, had a carrying capacity of 2,200 inches, or such less amount as the flume mentioned herein would carry if that amount was less than 2,200 inches; that the lands available for irrigation under the canal would require the amount claimed; and that, upon completion, the canal company was in a position to offer, and did offer, the water to actual and prospective users-and these questions are not to be retried. Upon the other questions involved the evidence is too indefinite to enable us to make final disposition of the cause. Cent. Dig. §§ 1055-1059; Dec. Dig. § 345.*] [Ed. Note.-For other cases, see Pleading, 4. BILLS AND NOTES (§ 489*) - ACTIONS — NONPAYMENT-BURDEN. In an action on a joint and several note against one of the makers, plaintiff must alsince payment by one would discharge all unlege and prove nonpayment by all parties, der Rev. Codes, § 4923, providing that performance by one of several persons jointly liable discharges the liability of all. [Ed. Note.-For other cases, see Bills and 489;* Contracts, Cent. Dig. § 1727.] Notes, Cent. Dig. §§ 1587-1642; Dec. Dig. § 5. PLEADING (§ 343*)-GROUNDS OF DENIAL. Judgment for plaintiff on the pleadings is improper, where the answer states facts suffito constitute counterclaims exceeding cient plaintiff's demand. [Ed. Note. For other cases, see Pleading, Cent. Dig. §§ 1048-1051; Dec. Dig. § 343.*] 6. SET-OFF AND COUNTERCLAIM (§ 44*) — PARTNERSHIP DEMANDS. Upon the facts stated, our conclusion is that the appropriation was actually completed upon the completion of the canal; that the right related back to the date when the notice was posted; that a valid appropriation of 2,200 inches, or such less amount as the A partner being entitled by Rev. Codes, flume would carry, was made; and that this $5472, to the application of firm property to the firm obligations, and under section 5494, appellant is entitled to a decree for that the firm being dissolved by the death of one amount, unless the whole or a portion of the of the partners, and under section 5469, proorignal appropriation has been lost by aban-viding that the interest of each partner exdonment or nonuser for an unreasonable length of time. It appears that the cause was determined upon an erroneous theory, and, in justice to all parties concerned, the judgment and order refusing a new trial should be reversed, and the cause remanded for a new trial as to appellant's right as indicated above, and it is accordingly so ordered. Reversed and remanded. BRANTLY, C. J., and SMITH, J., concur. (45 Mont. 231) FIRST NAT. BANK OF BUTTE v. SILVER. (Supreme Court of Montana. March 18, 1912.) 1. BILLS AND NOTES (§ 470*)-COMPLAINT NONPAYMENT. An allegation, in a complaint on a note, that defendant and E., a joint maker in his lifetime, and his legal representative since his death, have failed, neglected, and refused to pay said note, or any part thereof, is a sufficient allegation that payment has not been made by any one. tends to every part of the firm property, a surviving partner being entitled to exclusive control of the firm property, not merely in an administrative capacity but as owner, such a him on a firm note by setting up a countersurviving partner may defend a suit against claim to recover the value of firm property converted by plaintiff. [Ed. Note.-For other cases, see Set-Off and Counterclaim, Cent. Dig. §§ 82-96, 98, 99; Dec. Dig. § 44.*] 7. ACTION (§ 28*)-WAIVING TORT. One having a right of action for conversion may waive the tort and sue on implied contract. [Ed. Note.-For other cases, see Action, Cent. Dig. §§ 196-215; Dec. Dig. § 28;* Assumpsit, Cent. Dig. §§ 42-54.] 8. SET-OFF AND COUNTERCLAIM (§ 34*)—IMPLIED CONTRACT.' in an action on a contract any other cause of Rev. Codes, § 6541, subd. 2, providing that action on contract existing at the commencement of the action may be counterclaimed, applies to implied contracts. [Ed. Note.-For other cases, see Set-Off and Counterclaim, Cent. Dig. §§ 56, 57; Dec. Dig. $ 34.* For other definitions, see Words and Phrases, vol. 2, pp. 1513-1534; vol. 8, pp. 7615 [Ed. Note.-For other cases, see Bills and Notes, Cent. Dig. § 1462; Dec. Dig. § 470.*] | 7616.] 2. PLEADING (§ 122*)-DENIALS OF INFORMA- 9. TROVER AND CONVERSION (§ 9*)-DEMAND TION-MATTERS OF WEIGHT. -NECESSITY. Denial, by a person sued on a note, upon information and belief, whether an administratrix of a joint maker's estate had been appointed, and a denial of any knowledge or information as to whether the claim had been Where property is wrongfully taken from the owner, he may sue without a demand. [Ed. Note.-For other cases, see Trover and Conversion, Cent. Dig. §§ 58-83; Dec. Dig. § 9.*] Appeal from District Court, Silver Bow fully obtained possession of such check, causCounty; Jeremiah J. Lynch, Judge. Action by the First National Bank of Butte against J. R. Silver. From a judgment for plaintiff on the pleadings, defendant appeals. Reversed and remanded, with directions. James H. Baldwin, of Butte, for appellant. Robt. L. Clinton, of Butte, for respondent. HOLLOWAY, J. This action was brought to enforce payment of a promissory note dated December 16, 1905, due on demand, and executed and delivered by defendant and one John Eakins to the plaintiff. Before the action was commenced, Eakins died. The complaint, after alleging the execution and delivery of the note, contains, in paragraph 3, the following: "That prior to the commencement of this action plaintiff demanded of the defendant the payment of said promissory note, and that the defendant has at all times failed, refused, and neglected to pay said promissory note or any part or portion thereof, and that the said John Eakins in his lifetime, and his legal representatives since his death, have failed, neglected, and refused to pay said promissory note or any part or portion thereof." It is further alleged that Eakins died, that an administratrix of his estate was appointed, that plaintiff presented its claim, and the same was duly allowed, and paragraph 5 concludes as follows: "That no part or portion of said claim has been paid." The defendant answered, admitted the execution and delivery of the note, the death of Eakins, that he (defendant) had not paid the note, and then denies any knowledge or information as to whether Eakins in his lifetime, or his legal representatives since his death, paid the note or the debt evidenced by it; and further denied, upon information and belief, that an administratrix had been appointed for Eakins' estate, and denied any knowledge or information as to whether plaintiff had presented its claim or whether the same had been allowed or remains unpaid. Defend ant then pleaded two counterclaims, in the first of which he alleges that, prior to the execution of the note sued upon, he and Eakins formed a copartnership to carry on certain work in Butte; that the money rep. resented by the note was borrowed by them as copartners for the use of the copartnership in carrying on its undertaking and was in fact used by them as copartners in their copartnership enterprise. It is alleged that about January 19, 1906, one O'Brien, in payment for work done by the copartnership, executed and delivered to Eakins a check drawn upon the Daly Bank & Trust Company for $424.20; that Eakins received such check as the property of the copartnership and held it as such, and had it in his possession unindorsed at the time of his death. It is alleged that about February 16, 1906, this plaintiff, after the death of Eakins, wrong ed the name of John Eakins to be indorsed upon it, and then presented the check to the bank upon which it was drawn, collected the money, converted it to its own use, and ever since has failed and refused to account to the defendant for the same or any part thereof. The second counterclaim is in similar terms, except as to the amount of the check which it is alleged plaintiff procured and cashed. The prayer of the answer is that plaintiff take nothing; that defendant recover the amount of each of the two checks with interest, that he recover his costs, and for general relief. Upon these pleadings plaintiff moved for judgment, and the motion was granted. Plaintiff thereupon waived its claim for attorneys' fees, and the district court rendered and entered judgment, from which the defendant appealed. [1] 1. Contention is made that paragraph 3 of the complaint, quoted above, does not contain allegations sufficiently specific to show nonpayment of the note; but with this we do not agree. It requires the most strained construction of the pleading to admit of a doubt that payment has not been made by any one, if the allegations above are true. [2-4] 2. While it may well be said that the denial of information as to whether plaintiff presented its claim and had same allowed, and the further denial upon information and belief that an administratrix has been appointed for Eakins' estate are frivolous, since these facts can be ascertained from publie records, still the allegation that Eakins in his lifetime did not pay the note is put in issue by a denial of knowledge or information sufficient to form a belief as to the truth of that allegation. This form of denial is authorized by the Codes (Rev. Codes, § 6540), and when interposed to any material allegation of the complaint raises an issue (section 6723). That the allegation of nonpayment is a material and essential allegation in an action of this character is established in this state by repeated decisions of this court. Yancey v. Northern Pac. Ry. Co., 42 Mont. 342, 112 Pac. 533, and cases cited. The note sued upon is joint and several, and payment by one of the makers extinguishes the liability of all. Rev. Codes, § 4923. Thereforè, in order to show a breach of the condition of the obligation, it is necessary to allege that payment has not been made by any of the parties liable; and if issue be joined upon such allegation, then the burden is upon the plaintiff to make proof. Yancey v. Northern Pac. Ry. Co., above. Since the answer raises an issue as to nonpayment by Eakins in his lifetime, the motion for judgment on the pleadings should not have been granted. [5, 6] 3. The motion should not have been granted for another reason: If the answer states facts sufficient to constitute counterclaims, plaintiff cannot recover upon the record as now presented to us. The allegations of new matter are not denied, and the amount of the counterclaims exceeds the amount of plaintiff's demand. As we understand the answer, there is not any attempt made to set up a counterclaim in favor of a copartnership as against the individual liability of the defendant. The answer sets forth facts which, if true, disclose that the obligation upon which plaintiff sues is in fact a partnership obligation, and in an action upon such an obligation it is elementary that one partner may avail himself of a counterclaim in favor of the copartnership to defeat the plaintiff's recovery, even though such partner is separately sued or answers separately; the fundamental principle being that, if the demands are mutual, one may be counterclaimed as against an action upon the other. To constitute a counterclaim, the facts must disclose a cause of action in favor of the defendant and against the plaintiff, existing at the time of the commencement of the action. Rev. Codes, § 6541. If the allegations of these counterclaims be true, defendant and Eakins were copartners at the time this note was executed, and the note was the copartnership obligation (section 5489) and the money received upon it was partnership property (section 5468); so, likewise, were the checks received by Eakins, and converted by plaintiff, partnership property, and each member of the partnership can require that the partnership property be applied to the discharge of partnership obligations (section 5472). The death of Eakins worked a dissolution of the partner ship (section 5494), but did not affect the partnership property, except to give to this defendant, as the sole surviving partner, exclusive control of the property. Section 7607. He could retain possession and control, not by virtue of any supposed representative relationship, but jure proprio, since the interest of each member of the partnership extends to every portion of its property. Section 5469; Krueger v. Speith, 8 Mont. 482, 20 Pac. 664, 3 L. R. A. 291. By reason of his right to the possession of the partnership property, defendant may maintain any appropriate action for its recovery. this defendant at the time of the conversion, or since. Our conclusion is that the defendant has stated a cause of action against the plaintiff in each of these counterclaims, and the motion for judgment on the pleadings should have been overruled. The judgment is reversed, and the cause is remanded, with directions to overrule the motion. Reversed and remanded. BRANTLY, C. J., concurs. SMITH, J., concurs in the result. (20 Wyo. 183) PARKER v. MEADOWS. (Supreme Court of Wyoming. April 1, 1912.) 1. DEEDS (§ 167*)—CONSTRUCTION AND OPERATION-CONDITIONS SUBSEQUENT. In an action for the cancellation of a deed covering both real and personal property, which provided that in case of breach of condition the agreement should become void, and "title to cree awarding the real property to a grantor said land" should reinvest in the grantor, a deand the personal property to the grantee was proper, since forfeitures will not be extended beyond their strict terms. Dig. § 534; Dec. Dig. § 167.*] 2. TRIAL (§ 398*)-INCONSISTENT FINDINGS. [Ed. Note. For other cases, see Trial, Cent. Dig. §§ 946, 947; Dec. Dig. § 398.*] 3. DEEDS (§ 167*)-NATURE AND SCOPE. lieved against when compensation can be made. Forfeitures are not favored, and will be re[Ed. Note.-For other cases, see Deeds, Cent. Dig. § 534; Dec. Dig. § 167.*] Error to district court, Crook County; Carroll H. Parmelee, Judge. Action by Andrew J. Parker against Ada insufficient relief, and he brings error. Meadows. Judgment for plaintiff granting Af firmed. Enterline & La Fleiche and M. Nichols, for plaintiff in error. BEARD, C. J. This action was brought by the plaintiff in error, Andrew J. Parker, against the defendant in error, Ada Meadows, to set aside and cancel a certain deed executed by plaintiff to defendant. The court found generally for the plaintiff and also made certain special findings and conclusions of law, and entered a decree, canceling the deed and awarding to plaintiff the lands described in the deed, and awarding to defendant the personal property therein described. From the decree giving the personal property to defendant, plaintiff brings error and seeks a modification of the decree to that extent. [7-9] It is elementary, also, that one who has a cause of action in conversion may waive the tort and sue as upon an implied contract. Galvin v. Mac M. & M. Co., 14 Mont. 508, 37 Pac. 366. If the allegations of these counterclaims are true, defendant had causes of action against the plaintiff at the time it commenced this action, and by waiving the tort and proceeding as upon the implied contract, defendant could set up these causes as counterclaims to plaintiff's action, for subdivision 2 of section 6541 includes implied as well as express contracts. 34 Cyc. 676, and 711. And if the taking by plaintiff was wrongful, as alleged, a demand was not necessary; and neither is it essential to defendant's right to recover that The evidence is not brought up, and the plaintiff knew of the interest asserted by only question presented is whether the con clusions of law and decree are supported by | tiff executed and delivered to the said dethe pleadings and findings. The deed which plaintiff sought to have set aside was a deed, executed by him to the defendant, and conveyed certain lands therein described, and "said party of second part is also to have all stock and brand and implements on the premises," excepting a saddle mare, saddle, and bridle. The consideration for the deed recited therein was, in substance, one dollar, and that defendant should make a home for plaintiff on the land and furnish him with the necessaries of life during his lifetime. The deed contained the following condition: "And it is expressly agreed by and between the parties hereto, that if the party of the second part shall attempt to dispose of said property before his death, or in any manner fail to keep the covenants herein contained, then this agreement of deed shall become void and the title to said lands shall reinvest to the party of the first part, but if the party of the second part shall perform all the conditions herein set forth, then upon the death of said party of the first part, the title to said lands shall be absolute in the said Ada Meadows or her heirs." The deed was in the ordinary form, and contained the usual covenants of warranty. The plaintiff in his petition alleged that defendant had failed in a number of particulars to keep and perform the things required of her by the conditions of the deed, among which was that she had attempted to dispose of his property. The defendant in her answer denied any violations of the terms of the deed on her part, and filed a cross-petition, alleging fraud on part of plaintiff and other matters not necessary to set out here. The findings made by the court, so far as necessary to an understanding of the questions presented, are as follows: fendant the instrument of writing mentioned and set forth in the answer and cross-petition of the defendant; the same being in the words and figures following, to wit: "This is to certify that I have sold to Mrs. Ada Meadows all my horses in Crook Co., Wyo. branded 6 on left hip, also the brand. and also my farm when she goes there. Reserving the use of my spotted saddle mare Kit and the saddle and bridle and when the mare is unfit for use then said Ada Meadows is to furnish me with another good saddle horse as long as I live and can use one. In consideration of this the said Ada Meadows is to move into my house in Forest precinct, Wyo., and board, clothe and furnish me with all the necessary comforts of life as long as I live. But if the said Ada Meadows fails to perform the within stipulations then this agreement is null and void and of no further effect. Dated Missoula, Mont., Sept. 18th, 1907, A. J. Parker.' That, by reason of the execution of the deed and contract first herein mentioned and set forth, and by reason of the delivery and balance [acceptance?] thereof, as aforesaid, the said instrument in writing last hereinabove mentioned and set forth became a part of and merged into the said deed and contract. That the said defendant failed to keep and perform the covenants and conditions on her part to be performed, under and by virtue of said deed and contract, in that the said defendant, prior to the commencement of this action, did sell and dispose of some of the horses mentioned and described in the said deed and contract. That the said plaintiff has a legal estate in and to said lands described in the deed hereinbefore set forth, and is entitled to the possession thereof, and that the defendant unlawfully keeps him out of the possession of the said lands. "And upon the findings aforesaid the court doth find and state its conclusions of law, as follows: That the said deed and contract so made, executed, delivered, and accepted, as aforesaid, has become void, and that the same should be canceled and held for naught. and that the title to the lands mentioned in said deed should revert to the plaintiff herein, but that the title and possession in and to the personal property mentioned in said deed and not disposed of by the defendant shall remain in and belong to the defendant. That the plaintiff is entitled to the possession of said lands, and that he is entitled to a judgment for the cancellation of said deed, and for the possession of the said lands." "The court, being now fully advised in the premises, doth find generally for the plaintiff, and doth further find as follows: That on the 16th day of December, A. D. 1907, the plaintiff, being the owner of the property hereinafter mentioned, and being in possession thereof, made, executed, acknowledged, and delivered to the defendant, for the consideration therein expressed, a certain warranty deed and contract in words and figures following, to wit: [IIere follows a copy of the deed.] That within a few days thereafter the said plaintiff delivered said deed to said defendant, and the said defendant accepted the same, and thereupon and thereby entered into possession of the lands described in said deed, and took possession A decree was entered in accordance with of the property, both real and personal, men- the above-stated conclusions of law, and contioned therein, and ever since has remained tains the further order "that the cross-petiand now is in possession of all of said prop- tion of the defendant herein be dismissed, erty, saving and excepting as to some of the and that the plaintiff be permitted to amend horses which defendant has disposed of. his petition and the prayer thereof in accordThat, prior to the execution of the said deed ance with the proof and findings herein." and contract hereinbefore set forth, on the [1-3] Plaintiff's contention is that, as the 18th day of September, 1907, the said plain-court found generally for the plaintiff, and |