FEDERAL REI'ORTER I
BIDGELY v. OONEWAGO IRON CO. (Circuit Oourt, E.
Pennsylvania. January 31, 1893.)
limBs AND lIururq.-:...LEASlll-CONS'l'BUOTION-ROYALTY. . A mining lease the lessee to mine 4.000 tons ,of ore annually, and to pay therefor a fixed sum ton, or, falling to take out such quantity, to pay therefor, bIiposes ,no obligation on the lessee to pay for such stipulated quantity after the ore in the demised premises has become exhausted.
At Law. Action by Margaretta S. Ridgely against the Conewago Iron Company for breach of a mining lease. Rule for judgment for want of a sufficient affidavit of defense. Discharged. S.S. and HenryN. Paul, for rule. H. M. North, for defendant. DALLAS, Circuit Judgoe. This aetion is brought by the lessor against the leSl!lee, upon a lease ullder seal, dated December 24, 1885, ot"the exclusive right to' mine iron ore" on a tract of land in the state of Maryland for the term of ten years. The lease contains this covenant:
"'l'he paN of second part [1M, l,essee] agrees to PllrY tl,fty-five cents per ton. for every ton of 2,240 pounds of ore. mined and taken away under this lease, accounts :to be rendered and payinents to be made monthly, on the 15th day of each month; and the party ot the second part agrees andguarantles to take out at least 4,000 ,tons per YelLr,or, failiD,g to, take out that quantity', t() pay. for the sa)1le, with the undeflltanqing, however" thllt if, in anyone Yeal', the party of .the second part shall,have paid fOr nioreore. than it haS tiiltE!ll out dUring that year, it shall lulve the privilege of making up the amount in any subsequent year of this lease." '
'The breach assigned is that, during the five yel'\>rs last past, the defendant has failed to take out and pay for l'\>t least 4,000 tons of irQn ore per year. The affidavit admits this, but aver!J that the dehas, taken out and paid for all the orewhicb. was in the deJ1lised premises, and that by reason of its exhaustion it has not been possible, during the said five years, to take out any greater quantity than has in fact been taken out and fully paid for. .Mining leases commonly include, in addition to the usual undertaking to pay for what may be actually mined, a covenant that some fbwdor ascertainable s,um, at least, shall be annually paid. These C9venants are not all the same, or to. the same effect. They may be divided into two classes: First, those,which the payment of rent irrespective of produce; second, those which require that, upon failure to take out a stipulated quantity, royalty with respect thereto shall nevertheless be paid. Where the covenant is of the first class the tenant is liable for the rent, even if nothing could be got by mining. Marquis of Bute v. Thompson, 13 !fees. & W. 487; Phillips v. Jones, 9 Sim. 519; Jervis v. Tomkinson, 1 Hurl. & N. 195; Bamford v. Lehigh Co., 33 Fed. Rep. 677. Where the covenant is of the second class his obligation is to pay for the stipulated quantity,
whether mined or not; not whether it exists or not. He contracts for promptitude and thoroughness in mining; not for the productiveness of the mine. Lord Clifford v. Watts, L. R. 5 C. P. 577; Muhlenberg v. Henning, 116 Pa. St. 138, 9 At!. Rep. 144. This covenant is of the second clasa. The rule for judgment is discharged. .
COATES v. UNITED STATES.
(C1rcu1t Court of Appeals, Fourth Circuit. February T, 1893.'
No. 26. certaJn contractors agreed to build for the lighthouse board .. steamer for $66,900, payable In Installments at specified stages In the work, the contract and all moneys due thereunder to be forfeited for breach. Material men, who had been promised payment of their claims out of certaln installments, obtained from the contractors a power of attorney authorizing them to collect $6,000 out of the last Installment, and placed it on fUe with the naval secretary of the lighthouse board, who promised that if they would continue the delivery of materials the government would pay their claim to the amount of $6,000. At this time the government had the right to annul the contract for breach. In a correspondence with the naval secretary, who Was In doubt whether the money could be thus paid under .Rev. St. §§ 3477, 3737, the secretary of the treasury stated that the claim could be paid only on condition that the account for the money when due under the contract should be stated In the name of the contractors, and receipted for by them before payment to the material men. several months later the contract was forfeited for breach. The last installment never became due to the contractors, and the vessel was completed by the board at a cost, not Including this claim, of $726.10 less than the contract price. Held, that the material man could recover from the government only thesnm of $726.10. Hughes, J., dissenting.
AGAINST THE UNITED STATES-MATERIAL MAN'S CLAIM.
In Error to the Circuit Court of the United States for the Distri,ct of Maryland. At Law. Action by L. Roberts Coates, trading as Coates & Co., against the United States, to recover for materials used in the construction of a steamer. Judgment for defendant. Plaintiff brings error. Reversed. Frank P. Clark, for plaintiff in error. John T. Ensor, U. S. Atty. Before GOFF, Circuit Judge, and HUGHES and SIMONTON, District Judges.
SIMONTON, District Judge. The facts of this case are these: Ramsay & Son were under contract to build for the lighthouse board a twin screw steamer. afterwards known as the "Zizania." The contract price was $66,900, to be paid as follows: One fifth, less 10 per cent., when the vessel was framed and up; one fifth, less 10 per cent., when she was fully plated and keelson fitted and fastened in place; per cent., when all the deeks are laid, masts set up. one fifth, less and fastened m place; one fifth, less 10 per cent., when vessel Is launched, and boiler and engine in place; the remainder, with the re-