Blue River Sawmills, Ltd. v. Gates

ROSSMAN, J.,

dissenting.

At the very outset we must determine whether or not the Oregon courts have jurisdiction to grant the relief which the plaintiffs seek. The subject matter of the suit is an extensive timber domain, 18,560 acres in extent which is situated in the Province of British Columbia, Dominion of Canada. The plaintiffs want the Oregon courts to hold that an instrument on file in the Province of British Columbia which describes the timber domain just mentioned and which purports to be “an absolute conveyance,” that is, a deed, is nothing more than a mortgage. Thus, the Oregon courts are asked by their decree to affect the title to the timber just mentioned.

The exact nature of the right which the plaintiffs conveyed to the defendants and for which they seek a reconveyance is not disclosed by the record. It is clear, however, that it is a perpetual right and that it governs not only timber which is now growing but timber which may germinate in the years—in fact, centuries—to come. The complaint refers to the rights as timber licenses but it avers that the plaintiff, in making his conveyance to the defendants, employed an instrument known as “an absolute conveyance.” No citation to authority is needed to warrant the statement that the word “conveyance” denotes the transfer of an interest in land. The meaning of that *479 word is stated as follows in 18 CJS, Conveyances, page 91:

“* * * In its strict legal sense, the term imports a transfer of legal title to land, but in the popular sense of the term, and as it is generally used by lawyers, it denotes any transfer of title, legal or equitable. As a technical or quasi-technieal term, it is a word of precise and definite import, comprehending the several modes of passing title to real estate * *

Not only did the plaintiffs employ “conveyances” when they transferred their title to the defendants but the latter, in order to make provision for a re-transfer to the plaintiffs upon the latter’s repayment of the sums borrowed, executed “reconveyances.” For example, the complaint states:

“That all of said conveyances as hereinabove described, were delivered to the said Defendants Cates; that reconveyances were executed by the Defendants Grates and placed in escrow in the United States National Bank * * * to be delivered to the Plaintiff, Blue River Saw Mills, Ltd., upon the payment of said loan * *

It is clear that since the plaintiffs possessed a perpetual right which included timber to be grown in the distant future that they had a license with an interest; that is, an interest in the growing trees. Since unfelled trees are realty, the plaintiffs had an interest in the realty.

In determining whether or not a court possesses jurisdiction over a cause it takes note of only the averments of the complaint and not of the evidence which may subsequently be admitted. It is the averments of the complaint that confer jurisdiction if the court has jurisdiction at all. That such is the law is *480 well established. For example, Watts v. Gerking, 111 Or 641 , 222 P 318 , 228 P 135 , said:

“It is well to observe while passing that— ‘Jurisdiction always depends upon the allegations, and never upon the facts. * * * The truth of the allegations does not constitute jurisdiction.’ Van Fleet’s Collateral Attack, § 60.”

Substantially the same statement had been made previously in Dippold v. Cathlamet Timber Co., 98 Or 183 , 193 P 909 , in which this court quoted the following from Eagle Cliff Fishing Co. v. McGowan, 70 Or 1 , 137 P 776 :

“The authority of a court to hear and determine a cause depends upon the allegations of the initiatory pleading, and not upon the facts.”

See to like effect McDonough v. Southern Or. Mining Co., 177 Or 136 , 159 P2d 829 , 161 P2d 786 .

A preceding paragraph mentions some of the averments of the complaint. The prayer asks, among other items, for the following relief: “That it be adjudged and decreed that after the payment of the money herein specified, that the Defendants Gates have no title or interest in or to said timber licenses described in this complaint, or any of the property of the Plaintiff, Blue River Saw Mills, Ltd.”

The prayer is never disregarded when a court determines whether or not it has jurisdiction. Obviously, if the prayer asks for something that the court can not grant it must decline to take jurisdiction. In any event, if the averments of the complaint are doubtful or ambiguous the court looks at the prayer. For example, in O’Brien v. Fitzgerald, 143 NY 377 , 38 NE 371 , the court declared:

“* * * that relief as asked must necessarily solve the doubt, because there is no other solution.

*481 We see from the foregoing that a conveyance of the perpetual right to the timber growing upon a very large area in the Province of British Columbia is the subject matter of this proceeding. We held in Anderson v. Moothart, 198 Or 354 , 256 P2d 257 : “A sale of standing timber is the sale of an interest in real property.”

There is involved in this suit not only the timber that was upon the land when the parties had their transaction, but also the timber which will sprout up and grow to maturity in the years to come. That timber was owned by the plaintiffs. They conveyed it to the defendants. The trees have not been severed from the soil. Timber attached to the soil and growing in it is real property—so we held in the case from which I quoted in the preceding paragraph.

We are required to believe, from the complaint, that the conveyances which are involved in this proceeding grant the right not only to the removal of the timber but also the title to the timber itself. Otherwise, the word “conveyance” would not have been employed in describing the rights involved in this proceeding. We must also bear in mind that the right is a perpetual one.

The title to the timber aforementioned is manifested by an instrument which the complaint mentions as “an absolute conveyance” and is on file in the public records of the Province of British. Columbia. The prayer asks that we change the nature of that instrument from one that purports to be a deed and hold it to be nothing more than a mortgage. In other words, we are asked to insert in the instrument on file in British Columbia a defeasance clause. It seems very clear that an Oregon court has no juris *482 diction by its decree to affect the title to property in a foreign land.

The following is taken from 21 CJS, Courts, § 70, page 105:

“* * * Plaintiff must plead and prove the foreign law under which he claims, and that he had a cause of action thereunder in the state having such law.”

“The statute of the states where the cause of action accrued should be set out in the declaration or complaint, and plaintiff must be prepared to show the law of the state under which he claims the right asserted by him and that he had a cause of action which the courts of the state in which such cause of action accrued under their view of the law at the time of such accrual, would have enforced.”

The complaint makes no averment along that line. It is therefore deficient in an element needed to confer jurisdiction.

It is said, but not by the parties, that the following decisions deal with timber licenses of the same kind with which this proceeding is concerned and that they indicate that the rights involved in this proceeding did not in any way affect the title to real property. Crook v. Curry County, 206 Or 350 , 292 P2d 1080 ; Naegle v. Oke, 31 D.L.R. 501; Kerr v. Connell, 2 Berton 233; New Brunswick v. Kirk, 1 Allen 843 ; Breckenridge v. Woolner, 3 Allen 303 .

Crook v. Curry County, supra, denotes the point it decided in the following passage which we take from it:

“The reservation contained in the deed to the plaintiff does not reserve to the lumber company *483 any or all of the timber standing upon the land, but merely the right for a period of five years to go upon the land to take and remove the timber involved.

“The law is well settled that a mere reservation of a right to remove timber from land creates a license and not an estate in the land or timber.”

Those facts are so different from those involved in this proceeding that no comment is needed. In that case an individual was granted the right for a period of five years to go upon a tract of land and remove timber. In the case now before us there was transferred by an instrument termed “an absolute conveyance” a perpetual right to the timber produced upon a large area of land and to remove it. In the Crook case the right did not encompass timber not yet in existence.

Naegle v. Oke, supra, was an action by an individual who had the right to take water from his neighbor’s land for a period of years against the successor in interest of the neighbor to establish the plaintiff’s right to the water and for damages. The issue presented was what rights did the plaintiff acquire. The decision ruled that the plaintiff acquired a personal license and since he had sold the property he had no enforceable rights.

Kerr v. Connell, supra, was an action in trover by a holder of a one year timber license to cut 200 tons of white pine against a holder of a timber license to cut birch. Both licenses were for the same term and on the same land. In defining the plaintiff’s rights, the court determined that he did not have any rights in the standing timber and said that a “license in these terms (to cut and to remove) clearly amounts *484 to a grant of the timber which may be cut and removed according to the terms of the license but of no more. It conveys no title whatever to any timber which is not cut and removed by virtue of the license.” 238-239.

New Brunswick v. Kirk, supra, was an action by the grantor of a five year timber license against the assignee of the licensee to recover rent. It was determined that the license conferred no interest in the land but only a right to cut and carry away timber.

Breckenridge v. Woolner, supra, was an action by a holder of a one-year timber license against a trespasser for cutting and taldng timber. The court held the suit was not maintainable since the plaintiff had only a right to cut and remove the trees.

I do not believe that those decisions which were concerned with short terms are decisive of this case. If either the plaintiffs or the defendants wished it established that the Oregon courts had jurisdiction to insert a defeasance clause in the Canadian deed, and thereby convert it into a mortgage, the necessary averments should have been made.

But, if the court holds that it has the required jurisdiction I do not believe that the evidence presented by the defendants overcomes that of the plaintiffs which tends to show that the deed, absolute in form, was a mortgage. In suits of this kind we are not at liberty to disregard the established rules of evidence but are required to conform to them. Evidence, whether presented by a plaintiff or a defendant, which shows the negotiations that preceded the drafting and execution of the document must be deemed merged therein. I believe that the plaintiffs’ evidence established that the transaction was a mort *485 gage and that the defendants were not at liberty to seize upon occasional statements made in the preceding negotiations for the purpose of showing that a deed, and not a mortgage, was in the minds of the parties. The evidence establishes that the defeasance clause was somehow omitted from the deed.

I dissent.