MINING CORPORATIONS. AUTHORITY OF OFFICER. Ordinarily the secretary of a mining corporation, as such, has no right to execute and deliver the promissory note of the corporation without authority from the board of directors. McCarrick v. Lenox Mining Co. (Utah), 164 Pacific 478, p. 479. OFFICER'S CUSTOMARY EXERCISE OF AUTHORITY. Where it had been the custom of the secretary of a mining corporation to execute and deliver in behalf of the corporation promissory notes and instruments in writing and it was generally left for him to do without express direction of the board of directors, his authority to bind the corporation may be implied from the apparent power thus conferred upon him. McCarrick v. Lenox Mining Co. (Utah), 164 Pacific 478, p. 479. AUTHORITY OF PRESIDENT. The president of a mining corporation has no power to buy, sell, or contract for his corporation or to control its property, funds, or management. The president can not act or contract for the corporation any more than any one director. Quacker Oil & Gas Co. v. Jane Oil & Gas Co. (Oklahoma), 164 Pacific 671, p. 673. CONTRACT OF PRESIDENT REPUDIATION BY CORPORATION. Where a contract made by the president of a mining corporation for the sale of its properties, approximately $3,000,000 in value, was formally repudiated by the board of directors, the unauthorized act of the president can not bind the corporation in favor of a third person who was not a party to the contract. Quacker Oil & Gas Co. v. Jane Oil & Gas Co. (Oklahoma), 164 Pacific 671, p. 673. UNAUTHORIZED CONTRACT OF PRESIDENT-SPECIFIC PERFORMANCE. A mining corporation can not enforce the specific performance of an unauthorized contract executed by the president of another mining corporation by which the president undertook to sell all the storage oil belonging to his corporation; nor to restrain by injunction the selling corporation from otherwise disposing of its oil, where the corporation by its board of directors formally repudiated the unauthorized contract executed by its president. Quacker Oil & Gas Co. v. Jane Oil & Gas Co. (Oklahoma), 164 Pacific 671, p. 674. LIABILITY FOR ACTS OF PRESIDENT. A mining corporation that turned over to its president the entire operation of a distinct part of its mining operations on his own behalf may be liable for the acts of the president in conducting this branch of the business, where neither the corporation nor the president took any steps to show that such branch of the business was the individual operations of the president and where the miners, by reason of the method of employment and of payment and the property used in conducting the mining operations, were led to believe that the operations were in fact those of the corporation. Ward v. Liverpool Salt & Coal Co. (West Virginia), 92 Southeastern 92, p. 96. RIGHT TO SUE FOREIGN CORPORATION-DOING BUSINESS. A mining corporation organized in New York and carrying on its mining operations in Alaska can not be sued in the State of Washington and jurisdiction acquired by the courts of that State by virtue of a summons served upon a local agent with an office in Seattle, where the duties of the agent in no wise related to the carrying on of the mining operations in Alaska, but consisted in some purchases and the forwarding of supplies to the company in Alaska. McCario v. Alaska Gastineau Mining Co. (Washington), 165 Pacific 73, p. 75. CORPORATION ORGANIZED IN ONE STATE TO DO BUSINESS IN ANOTHER. A mining corporation was organized in the State of New York under the general statute of that State for the purpose of carrying on and conducting the business of gold mining on lands situated in the State of North Carolina. Such a corporation may sue in the courts of North Carolina where it has complied with the requirements of the latter State as to conditions precedent for doing business in that State and has been duly domesticated. Troy & North Carolina Gold Mining Co. v. Snow Lumber Co. (North Carolina), 92 Southeastern 494, p. 495.. CORPORATION TAX-DOING BUSINESS. A mining corporation that merely keeps up its organization for distributing rent received from a single lessee is not doing business within the meaning of the corporation tax act. Baumbach v. Sargent Land Co., 242 U. S. 503, p. 516. APPLICATION OF TAX LAW. Section 38 of the act of August 5, 1909 (36 Stat., 11), known as the Corporation Tax Law, applies to mining corporations. Baumbach v. Sargent Land Co., 242 U. S. 503, p. 517. INCOME -PROCEEDS OF ORES MINED. The proceeds from the sales of ores mined by a mining corporation from its own premises are income within the meaning of the act of August 5, 1909 (36 Stat., 11). Baumbach v. Sargent Land Co., 242 U. S. 503, p. 517. Corporations organized for the purpose of buying, owning, exploring, developing, leasing, improving, selling, and dealing in lands, and the doing of all things necessary or incidental to the things mentioned and for the further purpose of uniting in one ownership the undivided fractional interest of various stockholders for their convenience and to receive and distribute the proceeds thereof, and to receive and distribute among their shareholders the royalty from a number of outstanding, long-term mining leases and that employed another corporation to inspect the mining operations, to make mining exploration and to see that the lessees performed their contracts, are carrying on business within the meaning of the Corporation Tax Law. Baumbach v. Sargent Land Co., 242 U. S. 503, p. 516. DOING BUSINESS- -SERVICE OF PROCESS. A coal company of Pennsylvania maintains a branch office in New York in which it employs a sales agent and subordinate employees; but all sales made in New York are subject to confirmation by the home office in Pennsylvania and payments by customers are made to the treasurer in that State, as the local salesmen are without authority to receive or indorse checks and all shipments are made from the company's coal yards in Pennsylvania in response to orders transmitted from customers in New York. Such transactions constitute doing business within the State of New York in such a sense and in such a degree as to subject the coal company to the jurisdiction of the courts of New York by service of process on the sales agent. Tauza v. Susquehanna Coal Co. (New York), 115 Northeastern 915, p. 916. CONTRACT NOT USURIOUS. A contract by a mining corporation, not engaged in loaning money, by which it consented to make explorations of certain mining property and to expend a sum not exceeding $200,000 in such explora tions, and also agreed to discharge certain liens upon the property in consideration that it should receive a percentage of the stock in a company to be formed, is not subject to the charge of being usurious and therefore invalid although the par value of the stock to be issued was greatly in excess of the advances to be made. Titus v. United States Smelting, Refining & Mining Co., 240 Federal 881. STOCK SUBSCRIPTION-FAILURE OF CONSIDERATION-LIABILITY. A stock subscription whereby the subscriber undertook in consideration of 50,000 shares of stock in a gold mining company to pay $20,000 therefor can not be enforced where the evidence shows that of a capital stock of $2,000,000 the promotors had issued to themselves $1,500,000, without a dollar to the treasury and the other $500,000 was placed upon the market, a part of which the subscriber agreed to take and pay for. The proof shows that the stock was without any value because of the utter absence of assets of the corporation issuing it and that the subscriber was misled by false statements to the effect that the corporation owned certain mines and that in fact the corporation did not and never did own any mine or any other property. Under such circumstances the administrator of the deceased subscriber had the right to defend an action on the subscription on the ground of the want of consideration. Lindsay v. Sonora Gold Mining & Milling Co. (Missouri), 196 Southwestern 764, p. 765. 16543°-17-Bull. 159- -3 MINING CLAIMS. NATURE AND GENERAL FEATURES. DISTINCTION BETWEEN LOCATION AND PATENT. The location of a mining claim and a patent for a mining claim are not governed by the same rules. The mining statutes of 1872 expressly provide for the location of surface ground that must include the lode or claim as discovered; and a patent under this act can not grant any greater extent of surface ground than the location as made and marked by the surface boundaries. Whilden v. Maryland Gold Quartz Mining Co. (California App.), 164 Pacific 908, p. 912. OWNERSHIP OF MINERALS. The owner of a mining claim is prima facie entitled to all ore beneath the surface of his claim. Barker v. Condon (Montana), 165 Pacific 909, p. 912. VEIN OR LODE. MEANING AS USED IN MINING LAWS. By the term "veins or lodes" as used in the mining statute is meant lines or aggregations of minerals embedded in quartz or other rock in place. United States v. Ohio Oil Co., 240 Federal 996, p. 1000. DIP OF VEIN-PRESUMPTION. As a working hypothesis it may be assumed in the absence of a contrary showing that a vein or veins found within the vertical planes of the surface lines of a mining claim will continue to extend upward at the same angle as exhibited below. Barker v. Condon (Montana), 165 Pacific 909, p. 912. DISCOVERY. CONDITION TO LOCATION. A valid lode or placer mining claim can not be made until there is a discovery within the limits of the claims. United States v. Ohio Oil Co., 240 Federal 996, p. 998. |