George W. Roberts and Charles O. Roberts, Respondents, v. Alonzo L. Roberts and Others, Appellants

George W. Roberts and Charles O. Roberts, Respondents, v. Alonzo L. Roberts and Others, Appellants. Fourth Department, November 17, 1909. Landlord and tenant —mining lease construed — when action premature. A lease of a mine requiring the lessee to pay to the lessor a certain royalty per ton, the minimum amount to be paid to the lessor not to be less than §300 for the first year beginning three months from the date of the lease, and further providing that the first payment should be made on the 11th day of December, 1907, with monthly payments thereafter, should be construed to mean that the monthly royalties should be paid from the eleventh day of December, and if at the end of the year the royalties failed to amount to §300 the lessee should pay the deficiency. An action brought to recover the $300 before the expiration of ' the year is premature. . . McLennan, P. J., and Robson, J., dissented, with opinion. Appeal by the defendants, Alonzo L-. Roberts and others, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of Jefferson on the 15th day of January, 1909, upon the decision of the court, rendered after a trial at the Jefferson Trial Term, a jury having been waived. Thomas Burns, for the appellants. John B. Rogers, for the respondents. [MAJORITY — Spring, J.:] Spring, J.: The plaintiffs owned land in the county of Lewis containing mica and which they desired mined. On the 11th day of September, 1907, they leased and granted to the defendants these premises for the term of ten years for the purpose of mining and operating for mica. The instrument contained the following provision: “ In consideration hereof, the said parties of the second part promise and agree to pay to the said parties of the first part for each and every ton of mica taken from said premises the sum of ten (10) per cent, of the market price or value thereof at the dump. * * * And it is further agreed, and this lease is made upon the condition that the minimum price to be paid to the parties of the first part by the second parties shall be not less than two hundred dollars ($200) for the first year, beginning three months from the date hereof, and five hundred dollars ($500) for the second year thereafter, and seven hundred dollars ($700) for each and every year thereafter. And said second parties further agree to make such first payment on the 11th day of December, 1907, and the payments hereunder at the expiration of each and every month thereafter.” The instrument further provided that the lessors were to have the privilege at any time of examining the books of the lessees, and copies of the way bills for the freight shipped and of the invoices were also to be furnished them. In April, 1908, the plaintiffs commenced this action at law to recover the sum of $200, claiming that such sum constituted the first payment and matured on the lltli day of December, 1907. The defendants contend that it had not matured when the action was commenced, and I think that contention is correct. While the construction of the agreement is not free from doubt, it seems to me that the $200 had not matured when the action was commenced in April, 1908. The rental for the lease was to be ten per cent of the market price or value of every ton of mica mined. In order that the lessees should be certain of receiving some compensation for the lease of their lands, it was agreed that they should be paid for the first year, which was to commence three months from the date of the lease, not less than $200, and the minimum sum was increased in the subsequent years. By the terms of the lease, as I construe it, the lessees were to commence paying the ten per cent on the lltli day of December, 1907, which had already been designated as the time when the first year was to commence, so far as payments were concerned. After the first payment the ten per cent was to be paid at the expiration of each and every month thereafter, and if at the end of the year the $200 minimum price had not been paid whatever deficiency there was should be due. It seems to me that this gives a fair construction to the entire instrument. The keynote of the obligations assumed by the lessees is to pay ten per cent of the mica mined, and which is to be paid in monthly payments, the first of which is to become due on the lltli of December, 1907. If for any reason the ten per cent fails to reach the sum of $200 for the first year, then the deficiency is to be paid to the lessors, but this deficiency cannot be ascertained until the end of the paying year. It is evident that the parties anticipated a large revenue from the mica. The ten per cent of the value of this product was expected to be the compensation to the plaintiffs, and the fixed payments, or any part of them, were not to be paid until the necessity for so doing was determined at the end of the year. It is said that no mica has been mined. The action was commenced in April, 1908, and the defendants had several months in which they might realize from the mining the $200 of rent, which they were certainly obliged to pay. The judgment should be reversed, with costs. All concurred, except McLennan, P. J., and Robson, J., who dissented in an opinion by McLennan, P. J. [DISSENT — McLennan, P. J.] McLennan, P. J. (dissenting): The facts are not in dispute. On the lltli day of September, 1907, by an instrument in writing the defendants leased from the plaintiffs certain lands in the comity of Lewis for the purpose of mining mica thereon. The term of such lease was ten years and expired on the lltli day of September, 1917. By its terms the parties of the second part “ promise and agree to pay to the said parties of the first part for each and every ton of mica taken from said premises the sum of ten (10) per cent, of the market price or value thereof at the dump.” It further provides as follows: 6C And it is further agreed, and this lease is made upon the condition that the minimum price to be paid to the parties of the first part by the second parties shall be not less than two hundred dollars ($200) for the first year, beginning three months from the date hereof, and five hundred dollars ($500) for the second year thereafter, and seven hundred dollars ($700) for each and every year thereafter. And said second parties further agree to make such first payment on the lltli day of December, 1907, and the payments hereunder at the expiration of each and every month thereafter.” Concededly, no mica was mined upon the premises and, as we have seen, in April, 1908, this action was brought to recover the sum of $200 and interest from the 11th day of December, 1907, it being claimed that such amount became due at that time by the terms of said lease. It is urged by the appellants that the action was prematurely brought, it being claimed that the $200 mentioned was the minimum amount of the monthly payments for the first year, beginning on December 12,-1907, after the first three months of said term had expired. In other words, it is claimed that the first year commenced to run on December twelfth, the end of the first three months of said term. It seems to me that the 2d paragraph, to which I have called attention, determines the date on which the first payment shall become due, to wit, December 11, 1907, and provides for monthly payments of the royalties becoming due thereafter. The learned trial court construed the lease to mean that the defendants were to pay the plaintiffs $200 on the lltli day of December, 1907, and if thereafter during that year they mined mica they would not be required to make payment of the ten per cent provided for in the lease until the $200 was exhausted. In other words, that the provision that payments are to be made “ at the expiration of each and every month thereafter,” refers to payments that may be due after the $200 paid on December eleventh has been applied. I think the trial court was correct in its construction of the lease. The terms of the lease are .not ambiguous. It says: “ The minimum price to be paid * * * shall be not less than * * * $200 for the first year, beginning three months from the date hereof.” It seems to me clear that that clause was inserted for the purpose of fixing the date of the first payment. This is further shown by the language of the last sentence of the paragraph, viz. : “ And said second parties further agree to make such first payment (clearly that has reference to the $200) on the 11th day of December, 1907, and the payments hereunder at the expiration of each and every month thereafter.” The defense interposed is purely technical, for concededly no mica was mined, and, therefore, the $200 became the rental for the first year. It seems to me clear that under the lease the second parties agreed to make such first payment of $200 on the lltli day of December, 1907; that such sum not having been paid on that date, the plaintiffs were entitled to maintain an action to recover that amount, with interest, and I conclude that the lease was properly interpreted by the learned trial court. The judgment should be affirmed, with costs. Hobson, J., concurred. Judgment reversed and new trial ordered, with costs to appellants to abide event.