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BANCROFT 
 LIBRARY 
 
 THE LIBRARY 
 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 
H^N 
 
 ;0i- Plaint 
 

Tucson, Arizona 
 
 The Citizen Printing and Publishing 
 
 Company 
 
 1902 
 
C6'5 
 
 Copies of Complaint With Exhibits. 
 
 Answer Without Exhibits. 
 
 Cross - Complaint With Exhibit. 
 
 Answer to Cross-Complaint. 
 
 Minutes of Nogales Mining Company. 
 
 Abstract of Argument for 
 
 Temporary Receiver. 
 
i\!\\ 
 
Complaint With 
 Exhibit 
 
 In the District Court, First Judicial District, Territory 
 of Arizona, County of Santa Cruz. 
 
 H. K. Chenoweth and W. F. Chenowetli, Plaintiffs, 
 
 vs. 
 Nogales Mining Company, a Corporation, R. A. McPher- 
 
 son, Ray Ferguson, R. E. Doan, C. O. Richards and 
 
 Jesse R. Grant, Defendants. 
 
 The above named plaintiffs by permission of the court 
 obtained to amend their complaint instanter, do now 
 file this their amended complaint and in their own be- 
 half and in behalf of all the other stockholders of the 
 Nogales Mining Company, defendant, in a similar situa- 
 tion, complaining of me above named defendants, allege: 
 
 1. That the Nogales Mining Company, defendant, is a 
 corporation, and that it was duly organized under the 
 laws of the Territory of Arizona and has its princippJ 
 place of business at Nogales, Santa Cruz County, in 
 said Territory; that defendant R. A. McPherson is a 
 Director and the President of said corporation and that 
 
2 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 defendant Ray Ferguson is a Director and Secretary and 
 Treasurer of said corporation, and that defendant C. O. 
 Richards is a Director and Manager of said corporation, 
 and that the defendants R. E. Doan and Jesse R. Grant are 
 Directors of said corporation, as plaintiffs are informed 
 and believe. 
 
 2. That in uie year 1899 plaintiffs and defendant R 
 A. McPherson were sole owners of the Zaragosa mine, 
 situated in Curcupe, District of Magdalena, Mexico; that 
 defendant R. A. McPherson was owner of one-fourth 
 interest in said mining claim, ana plaintiffs were owners 
 of three-fourths interest in said mining claim; that 
 plaintiffs and said aefendant McPherson, being desirous 
 to develop said mining claim and render it a productivf^ 
 mine for their profit, organized and incorporated the 
 Nogales Mining Company, defendant corporation; that 
 thereafter plaintiffs and defendant McPherson con- 
 veyed to said corporation said Zaragosa mining claim; 
 that plaintiffs thereafter expended large sums or money 
 and performed much labor in the development of said 
 mining claim; that prior to the organization of said com- 
 pany plaintiffs agreed with the defendant Jesse R. Grant 
 that they would give him a one-fourth interest in said 
 mine or in the corporation organized for the purpose of 
 working said mine if he would assist either in the sale 
 of said mine or in the promotion of a company organized 
 to work said mine, and said defendant Jesse R. Grant 
 contributed a small sum, the exact amount being now un- 
 known, in bearing the expenses precedent to the sale of 
 said mining claim to the Nogales Mining Company; that 
 subsequent to the sale of said mine to said mining com- 
 pany, through the exertions of plaintiffs, the stock of 
 said corporation was sold in small amounts as herein- 
 
vs. NOGALES MINING COMPANY ET AL. 3 
 
 after shown, and large sums of money were borrowed 
 through the exertions of plaintiffs on the credit of saia 
 corporation and on the plaintiffs' private credit, towi". 
 some $70,000; that at the first meeting of the Nogaies 
 Mining Company the plaintiff H. K. Chenoweth was 
 chosen President of said company, and was President 
 continuously until auring the month of April, 1901, as 
 hereinafter shown, and that plaintiff W. F. Chenoweth 
 was one of tue Directors of said company auring tlie 
 same period; that from the time of tne organization of 
 said company untxi during the month of April, 1901, 
 plaintiffs were for all purposes the active agents and 
 representatives of said corporation and were recognized 
 as, and were, the members of said corporation, having 
 the largest interest and the greatest investment in said 
 corporation; that from time to time at the will of said 
 plaintiffs shares oi stock in said corporation were issued 
 to different persons to secure their services in assistance 
 of the promotion of said corporation; that in the montn 
 of April, 1901, ixxe total amount of stock in said corpora- 
 tion that had been issued, as plaintiffs believe to be 
 shown by tlie books of said company, was 19,509 shares 
 of the par value of $10.00 each, out of the total .xu- 
 thorized capital of 50,000 shares, of tne par vaiue of $10.00 
 each, the remaining shares being at that time in the 
 treasury of said corporation as treasury stock; that of 
 the shares issued up to April, 1901, plaintiffs jointly were, 
 and still are, owners of 7600 shares; that in July, 1900, 
 plaintiff W. F. Chenoweth was dected Manager of said 
 company and was empowered and instructed to com- 
 duct the uevelopment of the mining claim belonging to 
 said company, to erect the necessary buildings, mill, 
 machinery, and pumping plant, and other improvements 
 
•4 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 thereon; that the plaintiff W. F. Chenowetn continued as 
 such Manager, devoting nis entire time and attention to 
 the development and improvement ot said mining claim, 
 until in April, 1901, and that during most of that time 
 plaintiff H. K. Chenoweth devotcv^ his entire time to de- 
 veloping the interests of said company and' obtaining 
 loans and selling stock, to obtain capital for the work 
 of said company, and that during the period of time un- 
 der plaintiff's management there was expended on said 
 mining claim in its development, and in the erection of a 
 mill, pumping plan., machinery, and other improvements, 
 in the neighborhood of $80,000.00, the exact amount of 
 which plaintiff cannot now show, as will be hereinafter 
 explained; that in April, 1901, and just prior thereto, per- 
 sonal differences of opinion as to the method of manag- 
 ing the Nogales Mining Company, arose between the 
 plaintiffs and other stockholders of said corporation, and 
 that the stockholders who differed from plaintiffs in 
 the management of saia corporation represented their 
 differences through the defendant Jesse R. Grant; that 
 on the 12th day of April, 1901, plaintiffs and defendant 
 Jesse R. Grant, and one J. A. v^ooper, a stockholder 
 in said corporation, entered into a certain agreement in 
 the City of Hermosillo, Sonora, Mexico, executed be- 
 fore a Mexican Notary Public, a translation of which 
 agreement is attached hereto, marked "Exhibit A;" that 
 contemporaneously with said agreement plaintiffs and 
 defendant Jesse R. Grant entered into an agreement ex- 
 pressly made part of the before mentioned agreement 
 and depending in its fulfillment upon the fulfillment of 
 the before mentioned agreement, a copy of which 
 last mentioned agreement is attached hereto 
 marked "Exhibit B;" that relying upon the prom- 
 
VS NOGALES MINING COMPANY' ET AL. 5 
 
 ises made by the said Cooper and the said de- 
 fendant Grant in said agreements plaintiffs resigned 
 trom their offices in the Nogales Mining Company and 
 surrendered the voting power of their stock, subject only 
 to the reservations in said agreements set forth, to said 
 defendant Grant, relying and believing in good faith that 
 defendant Grant would fultill his promises to plaintiifs 
 and would settle ail the obligations of said company and 
 would pay for plaintiffs' interests as stipulated in the 
 said agreements; that plaintiffs have fulfilled every part 
 of their agreement; that following upon the execution 
 of said contracts, at the succeeding annual meeting, the 
 stockholders present elected a new Board of Directors, 
 electing as Directors the defendants (expect the corpora- 
 uonj in this cause; tuat piaintiffs are now informed and 
 believe that defendant Grant had no intention of per- 
 forming his agreement m the contracts entered into 
 but that, conspiring with other defendants, he purposed 
 to exclude plaintiffs from all profits and advantages of 
 this corporation and by deceiving them and thus getting 
 them off the Board of Directors, to gain, with others of 
 said defendants, personal control of said corporation, to 
 wreck said corporation, and to become himself, with 
 others of said defendants, sole owners of the property of 
 said company; that at the time of the election of de- 
 fendants (except the corporation) as Directors of the 
 fendant corporation, defendant Doan was, and is owner 
 of 2340 shares of the stock of said corporation; that 
 defendant McPherson, as plaintiffs are informed and be 
 lieve, was owner of one share of the stock of said cor- 
 poration; that defendant Ricnards, as plaintiffs are in- 
 formed and uelieve, was owner of one share of the stock 
 of said corporation; that defendant Ferguson was the 
 
6 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 owner of one share of the stock of said corporation; and 
 that defendan. Grant was owner of 1408 shares of the 
 stock of said corporation. 
 
 3. Plaintiffs further show that at the time of the exe- 
 cution of the contracts hereinbefore mentioned, piaintiff 
 W, F. Chenoweth as Manager of said corporation rend- 
 ered an accounting in which there was shown to be due 
 to him a balance for moneys expended in behalf of de- 
 fendant corporation in the sum of $3,833.35; that his ac- 
 counts were audited by said corporation and appuovet , 
 and that thereupon he turned over to the representative 
 of said corporation all the books, vouchers, accounts and 
 papers belonging to said corporation or pertaining in 
 any wise lo said W. F. Chenoweth's accounts as Managar 
 of said corporation, keeping no copies thereof, ana tha^ 
 for this reason plaintiffs are not able to state in exact 
 figures certain sums of money heretofore mentioned, and 
 hereafter to be mentioned. 
 
 4. Plaintiffs furc..er snow that at the time saia con 
 tracts were executed defendant corporation was in- 
 debted to one Henrietta Stewart of Washington, D. C, 
 in the sum of $63,500.00, and to one C. Ramirez of 
 Nogales, Sonora, Mexico, in the sum of $5,000.00, and to 
 plaintiff W. F. Cnenoweth in the sum of $3,833.35, and to 
 other persons in various small sums aggregating about 
 $7,000.00, making the total indebtedness of said corpora- 
 tion at that time, so far as is known to plalntilfs, ap- 
 proximately $7y,o33.3o; tha/t on the mining claim belong- 
 ing to said company there haa been erected a 20-stamp 
 mill with equipment, and a pumping plant wiih 
 equipment, at a contract pnce of $35,000.00; that other 
 improvements in the way of buildings and mining im- 
 plements to the value of many thousand dollars, the ex- 
 
VS NOGALES MINIKG COMPAlS^y ET AL. 7 
 
 aci amount of which plaintiff cannot state, were on said 
 mining claim belonging to said company; tnat the 
 Articles of Incorporation of said company permit a 
 maximum indebtedness of $80,000.00; that said mining 
 •claim if properly developed and worked is of ample value 
 to pay all indebtedness of sa.a corporation; that the 
 defendant Directors of said corporation have fraudtilently 
 c-onspired to freeze out plaintiffs from all the benefits 
 of said corporation; that thvey used the eoniract here- 
 inbefore described as the means of obtaining control of 
 said corporation and its property in oad faith and to 
 accomplish the destruction of said corporation during 
 the time that plaintiffs were out of control, and cause the 
 sale, as plaintiffs are inform*.- ana believe, to tuem- 
 selves, or to a corporation organized by themselves, of 
 all the property of said defendant corporation, and lo 
 this end th'^'y procured the creditor Henrietta Stewart 
 to. institute an attachment suit in the courts of Mexico 
 and levy an attachment upon the property of said cor- 
 por^,tion, disregarding their duties as Directors and 
 officers of said corporation, and failing to in any wise 
 defend said suit; tuat further lo carry out their purpose 
 they mortgaged all the property of said corporation to 
 defendant C. O. Richards for an alleged loan of $15,- 
 000.00 and are permitting said Richards to foreclose the 
 company of all title to cne company's properiy py pro- 
 ceedings in Mexico without defending the same; that 
 there is no provision in the Articles of Incorporation 
 whereby plaintiffs can secure a meeting of the stock- 
 holders of said corporation and the election of a new 
 Board of Directors; that by the failure of the defendant 
 Grant to perform his part of the contracts heretofore 
 mentioned plaintiffs are now in full right stockholders 
 
8 PAPERS IN THE CASE OP CHENOWETH ET AL. 
 
 and owners of their shares of stock in said corporation 
 as heretofore shown; tnat the defendant Directors are now 
 arranging, as plaintiffs are imormed and believe, to 
 transfer by deed all the property of said corporation to 
 a new corporation organized by defendant Directors, 
 their purpose being, as plaintiffs are informed and be- 
 lieve, to use tne proceedings against said corporation by 
 said Henrietta Stewart and said C. 0. Richards, as a 
 cloak to cover tne transactions whereby they may gain 
 sole control of the mining claim belonging to said cor- 
 poration, and of its property and improvements, and 
 thus render plaintiffs' interest .n said corporation of no 
 value, and cause them to lose all they have invested in 
 said corporation; that the alleged loan of $15,000.00 
 from said C. O. Richards is in addition to the oblir^ations 
 heretofore name.- by plaintiffs, and if a genuine indebted- 
 ness, renders the total indebtedness of said defendant 
 corporation far in excess of the maximum allowed by its 
 Articles of Incorporation; that if defendants are allowed 
 to carry out the plans upon which they havp embarked, 
 the creditors of said corporation will be defrauded of 
 their dues, the stockholders of said corporation who are 
 not parties to this conspiracy will lose all their invest- 
 ment, and said corporation will be wrecked; that 
 plaintiffs believe that in the application herein to be 
 made they represent the majority of stockholders of &aid 
 defendant corporation; that if a meeting of the stock- 
 holders could legally be held and a new Board of Direct- 
 ors legally be elected, a Board of Directors who v/ould 
 honestly and for the best interests of the company con- 
 duct its affairs, would be elected; that the final failure of 
 the contracts hereinbefore mentioned could not be 
 known, as is evident from the contracts themselves, un- 
 
vs. NOGALES MINING COMPANY ET AL. 9 
 
 til the 12th day of this current month; that the stock- 
 holders other than defendants and plaintiffs live so re- 
 mote from Santa Cruz County that plaintiffs cannot 
 without such loss of time as would still farther en- 
 danger the rights and interests of themselves and 
 other stockholders in like situation, procure them to join 
 with plaintiffs in this complaint, and therefore bring 
 this suit in their own behalf and in behalf «if ail the 
 other stockholders of the defendant corporation except 
 the defendants. 
 
 •5. That plaintiffs have no adequate remedy at law; 
 tnat the damage threatened by defendants, and already 
 done by defendants, is irreparable; that under their 
 management the property of the company is being 
 wasted and made away with; that these defendants and 
 none of them can respond in damages to plaintiffs for 
 their conspiracy and fraud, 
 
 6. Plaintiffs further show that as plaintiffs are in- 
 formed and believe the said defendants refuse to recog- 
 nize plaintiffs as stockholders in said defendant corpo- 
 ration, asserting as plaintiffs are informed and believe 
 that by virtue of the contract filed herewith and mark- 
 ed "exhibit B," the said plaintiffs have lost all right, 
 title and interest in and to their shares of stock in said 
 defendant corporation; that defendants have transferred 
 on the books of the defendant corporation 2800 shares of 
 the stock formerly issued to the said plaintiffs to the 
 said defendant C. O. ^^ichards under an assignment, as 
 plaintiffs are informed and oelieve, from the defendant 
 Jesse R. Grant, said assigment and transfer being al- 
 leged to be made by virtue of the said contract. 
 
 7. Plaintiffs further show that tnere should be deliv- 
 ered to said plaintiffs 3800 shares of stock in said cor- 
 
10 PAPERS IX THE CASE OF CHENOWETH ET AL. 
 
 poration as provided by the resolutions of tne stock- 
 holders of the said defenaant corporation made on Jan- 
 uary 12th, A. D, 1901, and shown on the minutes of said 
 meeting, which said stock aefendants have refused to 
 issue to said plaintiffs, and continu'i so to refuse. 
 
 Wherefore plaintiffs pray: 
 
 1st. For judgment requiring the defendants to cancel 
 the shares of stock in said defendant corporation issued 
 to the said C. O. Richards and belonging to plaintiffs, 
 and to re-issue the said stocK to plaintiffs. 
 
 2nd. For judgment requiring defendants to issue to 
 plaintiffs 3800 shares of stock in said defendant corpora- 
 tion as provided in the meeting of cae stockholders of 
 January 12th, xv. D. 1901. 
 
 3rd. For judgment requiring defendants to recognize 
 plaintiffs as stockholders in said defendant corporation, 
 and to give them full rights as such stockholders. 
 
 4th. For a writ of injunction enjoining the aefend- 
 ant C. O. Richards from proceeding in any court or by 
 means of any sale to foreclose any mortgage given to 
 him by the defendant corporation and from transferring 
 to any person or persons his rights under said mortgage 
 and from directly or indirectly procuring or permitting 
 any other person or persons to foreclose said mortgage, 
 or procuring or permitting the sale of the property or 
 any part thereof of the defendant corporation, mort- 
 gager, for the payment or part payment of the debt for 
 which said mortgage is security. 
 
 5th. For judgment declaring the alleged indebtedness 
 to the said C. O. Richards secured by the said mortgage 
 to be null and void. 
 
• r 
 vs. NOGALES MINING COMPANY ET AL. 11 
 
 6th. For a writ of injunction prohibiting the defend- 
 ants or any one of them from adding in any respect or 
 in any manner to the indebtedness of the said defendant 
 corporation. 
 
 7th. For the appointment of a receiver to tal^e 
 charge and to keep the mining claim, mill, pumping 
 plant, buildings, tools, machinery, moneys, credits, trea- 
 sury stock, and all other property of any nature whai- 
 soever of said corporation, and to preserve the same, 
 pending final judgment in this cause, and pending fur- 
 ther order of this court, and to defend suits brought 
 against said corporation, and to bring suits in behalf 
 of said corporation, in any court, or for any purpose 
 necessary for the protection of the property or interests 
 of said corporation and its shareholders. 
 
 8th. For judgment ordering the dissolution and wind- 
 ing up of the defendant corporation, and for the appoint- 
 ment of a receiver to wind up the affairs of the defendant 
 corporation, to sell its property under the orcers of this 
 court and to apply the proceeds thereof to the indebted- 
 ness of the said corporation under the orders of this 
 court, and to conclude all the business of the said cor- 
 poration and distribute such surplus assets as there may 
 be among the shareholders of the said corporation und'jr 
 the orders of this court. 
 
 9th. For such further or other or different order 
 in the premises as to the court may seem good. 
 
 H. K. Chenoweth and \v. F. Chenoweth, 
 By Frederick S. Nave, their Attorney. 
 
32 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 Territory of Arizona, [ 
 County of Santa Cruz. \^^' 
 
 W. F. Chenoweth, being duly sworn, deposes and says: 
 That he is one of the complainants in the above en- 
 titled cause; that he iias read the foregoing complaint, 
 and knows the contents thereof, and the same is true of 
 his own knowledge, except the matters therein stated on 
 information ana belief, and that as to those matters he 
 believes it to be true. 
 
 W. F. Chenoweth. 
 Subscribed and sworn to before me this 4th day of 
 .January, A. D. 1902. 
 
 Frederick S. Nave, 
 Notary Public. 
 (Seal) ^_ 
 
 "EXHIBIT A." 
 
 In the city of Hermosillo, capital of the State ol 
 Sonora, Republic of Mexico, on the twelfth day of the 
 month of April, one thousand nine hundred and one, 
 before me. Attorney J. Guillermo Dominguez, Notary 
 Public, in my ofiBcial capacity, and before the witnesses 
 Messrs. Eduardo Weidner and Ambrosio I. Lellevier, of 
 lawful age, residents of this vicinity and having the 
 legal qualifications to testify, appeared for the one 
 part Dr. William F. Chenoweth, in his own behalf and 
 also as a representative of his brother, H. K. Cheno- 
 weth, as is shown by a power of attorney as will here- 
 after appear, and for the other part Messrs. Jesse K. 
 Grant, in his own behalf, and James A. Cooper, in his 
 own behalf and also as a representative of the Cerro 
 Prieto Mining Company, Anonymous Society, as is shown 
 
vs. NOG ALES MINING COMPANY ET AL IS 
 
 iDy the document which will hereafter be spoken of, all 
 x3ontracting parties being of lawful age and residents of 
 Nogales, Arizona, United States of America, and 
 temporarily residents of this city for the purpose of 
 contracting and obligating, and whom 1 certify to know 
 personally, and declared that they have executed th<> 
 contract for the purchase and sale which is set iorrh in 
 the following articles. 
 
 First Dr. William F. Chenowetli declares that his 
 brother, H. K. Chenoweth, is the owner in property and 
 control of twenty-five free shares, numbered from one 
 to twenty-five inclusive, of the capital «tock of the 
 Cerro Prieto Mining Company, Anonymous Society, 
 and the declarant is the owner also in property and 
 control of twenty-five shares not free, numbered from 
 76 to 100 inclusive, of the same company of . Cerro 
 Prieto, the said fifty shares belonging lo the first 
 series; that Mr. H. K. Chenoweth acquired his shares 
 by transferring to the business of the Cerro Prieto the 
 mines "Elisa" and "Grant" as social capital, and the 
 declarant Dr. William F. Chenoweth acquired his shares 
 by adding to the same company two thousand nine hun- 
 dred dollars Mexican silver as his proportional part cf 
 the social fund, all of which appears in the organic 
 writing of sai^ company, executed on the twelfth day 
 oi March, one thousand nine hundred, before the un- 
 dersigned Notary, and duly attested in the 3ook of 
 Registry of Shares of said company, which documents 
 I the undersigned Notary certify to have before me. 
 
 Second. The said Dr. William F. Chenoweth de- 
 clares that the twenty-five shares of his brother, H. K. 
 Ciienoweth, by virtue of the representation with which 
 
U PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 he is accredited and me twenty-five shares which be- 
 lung to the declarant in his own right, he sells, codt^s, 
 and conveys to Mr, Jesse K. Grant, for the oum of 
 thirty thousand dollars gold monry of the United States 
 of America, which amount the said Jesse R. Grant is to 
 deliver to the declarant, Dr. Chenoweth, inside ol six 
 months, counted from the date ol the present writing, in 
 this city of Hermosillo. 
 
 Third. The first evidence of the present writing, duly 
 registered, and the fifty shares before mentioned, shall 
 be deposited, in a closed and sealed package, m the 
 Bank of Sonora, with a simple copy of the same writing 
 for the information of said bank, stipulating that the 
 Bank of Sonora alone Snall deliver the fifty shares 
 referred to, together with the evidence of ihis writing, 
 to Mr. Jesse R. Grant, when he, inside of the six 
 months fixed, shall present to it a receipt from Dr. 
 William F. Chenoweth Dy which he acknowledges that 
 he has received from Mr. Grant the thirty thousand dol- 
 lars gold, the price of tuis sale. 
 
 Fourth. If at the conclusion of the six months before 
 mentioned Mr. Grant has not delivered to Mr. Cheno- 
 weth the sax^ thirty thousand aollars gold, then Mt. 
 Chenoweth shall recover from the Bank of Sonora the 
 package containing the fifty shares and the evidence of 
 this writing, holding as rescinded this plan of con- 
 tract without the necessity of a judicial decision, and 
 Mr. Grant shall lose ^y the way of forfeit that which up 
 to this time he has given to Mr. Chenoweth. 
 
 Fifth. Mr. Jesse R. Grant moreover obligates himself 
 to pay all the bills which the business of the Nogales 
 Mining Company, Anonymous Society, has in Arizona 
 and Sonora, which bills have been reviewed by ihe said 
 
vs. N0GALE8 MINING COMPANY ET AL. 15 
 
 Mr. Grant, and also to pay those which have not Teen 
 reviewed but are legal and were contracted Jnring the 
 months of April and March of the present year. 
 
 Sixth. Mr. James A. Cooper, in his capacity of 
 Vice-President of the Cerro Prieto Mining Company, 
 Anonymous Society, as expressly authorized by ♦^he 
 General Assembly of Stockholders, as app-^ars by the 
 documents which will hereafter be spoken of, declares 
 that in tlie name of the Cerro Prieto Mining Company, 
 Anonymous Society, he obligates the said company 
 that it will not moitf age, hypothecate nor transfer, in 
 any manner, neither in whole nor in part, the business, 
 until the thirty thousand dollars in gold of which this 
 writing treats, shall be paid to Mr. William P. Cheno- 
 weth. 
 
 Seventh. The said Mr. Cooper declares that the 
 Messrs. Dr. William F. Chenoweth and H. K. Cbeno- 
 wetn shall be held free of all liability under the posi- 
 tions which they hold in the management of the Cerro 
 Prieto Mining Company, Anonymous Society, and the 
 Nogales Mining Company, Anonymous Society, tho two 
 companies renouncing all their claims and actions 
 which they might have against the said Messrs. Cheno- 
 weth. 
 
 Eighth. The said Mr. Cooper declared that the busi- 
 ness of the Cerro Prieto Mining Company, Anonymous 
 Society, exempts the Messrs. Chenoweth from the obliga- 
 tion which they have been unuer by the agreement to sell 
 to the company the mines WixiCh they had denounced, 
 permitting them from now on and .for all time to make 
 said mines their own, as their own property acquired 
 with a legal title. 
 
16 PAPERS IN THE CASE OF CHENO\TETH ET AL. 
 
 Ninth. The said Mr. Cooper, in the name cf the 
 Cerro Prieto Mining Company, Anonymous Society, sells, 
 cedes and transfers to ^iie Messrs. Chenoweth three 
 fourth part remaining, making the transfer as an addi- 
 the company, as is shown by the writing of the twelfth 
 of April, one thousand nine hundred, executed by L. B. 
 Harris and M. R. Harris, his wife, in Oakland, State 
 of California, in favor of the Company of Cerro }*ritto, 
 which document I the unuersigned Notary certify to 
 have before me, the said Mr. Cooper reserving the 
 fourth parts of the mine callea "San Diego," property of 
 tion to the price of sale of the shares of the Messrs. 
 Chenoweth. 
 
 Tenth. The direction of the Cerro Prieto Mining 
 Company, Anonymous Society, when the present instru- 
 ment shall be signed, shall remain in the control of C. 
 O. Richards, Dr. Chenoweth in consequence provision- 
 ally yielding control for the term of six months which 
 has been fixed in the present writing; but if the .^aid 
 writing is rescinded because oi the failure to fulfill the 
 contract, then Dr. Wiiiiam F. Chenoweth shall continue 
 to exercise the control as Director General of the com- 
 pany until the end of his legal term. 
 
 Eleventh. The said Mr. Cooper, and likewise Mr. 
 Jesse R. Grant, declares that the failure to fulfill any 
 stipulation of the present writing shall be sufficient 
 cause for rescinding the present contract, holding it as 
 terminated without the necessity of a judicial decision. 
 In the same manner and unaer the same conditions, Mr. 
 H. K. Chenoweth ceases to exercise his office of Trea- 
 surer and Commissary of the company for the same 
 term of six months, Mr. R. A. McPherson being appoint- 
 ed .n his place. If at the end of the six months the pres- 
 
vs. NOGALES MINING COMPANY ET AL. 17 
 
 ent writing is fulfilled in all its stipulations then the; 
 Messrs. Cnenoweth shall finally cease to exercise their 
 control. 
 
 Twelfth. Dr. William F. Chenoweth is personally ac- 
 credited in that which concerns his brother, H. K. 
 Chenoweth, by a general rower of Attorney executeu 
 before the undersigned Notary the sixteenth day of 
 February, one thousand nine nundred; and Mr. James 
 A. Cooper is duly authorized by the Book of Acts of 
 the Cerro Prieto Mining Company, Anonymous Society, 
 in which book I the undersigned Notary certify to have 
 seen an Act marked number six corresponding to the 
 extraordinary session of the General Assembly of 
 Stockholders, -in which \ct is shown the authorization 
 and approval of that which this contract contains, he 
 being shown in said Act to be duly commissioned to 
 execute the same in these articles which it has au- 
 thorized. 
 
 Thus they executed this, and it being read to 'them 
 by the interpreter, Mr. Carlos H. Milles, they ratified 
 it in all its parts, and signed it with the witnesses and 
 the interpreter in my presence. 1 certify that the con- 
 tracting parties declarea that Mr. Jesse R. Grant is to 
 •assume the payment of all bills of tne Nogales Mining 
 Company, Anonymous Society, with which it is chargea 
 in Arizona and Sonora; also the accounts of March and 
 April of which the fifth article of thiS writing speaKs. 
 And the said Jesse R. Grant is subrogated to the rights 
 of the creditors against the Nogales Mining Company, 
 Anonymous Society, but the amounts which tnose bills 
 represent he only advances in tne character of a loan 
 to pay said debts, having for that a right by which said 
 
18 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 Company of Nogales shall repay uim that which he 
 pays in its behalf. 
 
 Mr. Chenoweih declares on his part that the business 
 of the Cerro Prieto Mining Company, Anonymous 
 Society, is not mortgaged nor hypothecated nor trans- 
 ferred to any person, but is entirely free of aL debt and 
 ail obligation; and the said Mr. Chenoweth obligates 
 himself to put Mr. Grant in absolute possession of the 
 property. Mr. Chenoweth also declares that up to this 
 date, as is shown in the Book of Register ot the com- 
 pany, only one hundred shares oi the first series have 
 been issued. 
 
 Signea: 
 
 Jesse R. Grant. 
 
 W. F. Chenoweth. 
 
 Carlos R. Milles, Interpreter. 
 
 Jas. A. Cooper. 
 
 Eduarc.0 Vveidner, Witness. 
 
 A. I. Lellevier, Witness. 
 
 J. Guillermo Dominguez, Notary Public. 
 Simpxe copy. 
 
 "EXHIBIT B." 
 
 Nogaies, Ariz., April 12, 1901. 
 
 Memorandum of an agreement entered into this 12th 
 day of April, 1901, by ana between W. F. Chenoweth and 
 H. K. Chenoweth, parties of the first part, and Jesse R. 
 Grant, party of the second part. 
 
 Witnesseth: That in consideration of five thousand 
 dollars United States current money, to be paid to the 
 party of the first part by party of the second part, 
 the said party of the first part agrees to sell, transfer 
 
vs. NOGALES MINING COMPANY ET AL. 39 
 
 and assign to cue party of the second part, all their 
 right, title and interest in all the stock owneG hy tnem 
 in the Nogales Mining Company, a corporation, formed 
 under the laws of the Territory of Arizona, and having 
 its principal office in Nogales, Arizona, reserving only 
 such stock as represents 700 shares out of the 50,000, 
 which interest we iiave previous to this agreement con- 
 tracted to deliver to other parties. 
 
 Further it is agreed that this contract shall not con- 
 flict with, but shall become a part of a certain contract 
 and agreement entered into on the 11th day of April, 
 1901, in the city of Hermosillo, for the transfer of 50 
 shares of stock in the Cerro Prieto Mining Company, a 
 corporation existing under the laws of the State of 
 Sonora, Republic of Mexico, wnereby the full amount 
 the parties of the first part shall receive is thirty-five 
 thousand ($35,000.00) dollars United States gold coin, 
 and this document is a receipt for five thousand ($5,000) 
 dollars. The other thirty thousand ($30,000.00) dollars 
 shall be paid within six months rrom the date of sign- 
 ing: of the contract with the Cerro Prieto Mining Com- 
 pany before mentioned, viz: the 11th day of April, 
 1901, making this contract or agreement void after 
 October 11th, 1901. 
 
 Further it is agreed that the party of the second part 
 accepts this contract, relieving the parties of the first 
 part from all responsibility and turther agrees to carry 
 out all legal contracts and pay all legal bills. Further 
 the party of the iirst part agrees to see that a certain 
 option given to one R. A. McPherson, by one of the 
 parties of the first part on or about February 25th, 
 1901, and which said first party considers void, but in 
 order to avoid he expense of defending any suit said 
 
20 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 McPherson might ins.,igate, said second party agrees to 
 have said option duly cancelled and does hereby relieve 
 said first party from all reliability. 
 
 Further the parties of the first part hereby direct the 
 Secretary of the Nogales Mining Company to enter the 
 contents of this contract on the books of the com- 
 pany, and we authorize said Secretary to accord to said 
 second party the full voting power of the stock owned 
 by the said first parties during the term of this con- 
 tract, and upon the fulfillment of the same to cancel said 
 stock as represented in this contract and reissue the 
 same to the saia second party. 
 
 Further, the said first parties do hereoy authorize the 
 Secretary of the Nogales Mining Company to enter on 
 the books of the company the resignations as Directors 
 and officers of said company the names of W. F. Oheno- 
 weth, H. K. Chenoweth and Eliza E. de Chenoweth, said 
 resignations to date from Aprii 9th, 1901. 
 Jesse R. Grant, 
 vv. F. Chenoweth. 
 H. K. Chenoweth. * 
 
 Eliza E. de Chenoweth. 
 Witness: . ,j 
 
 Jas. A. Cooper. 
 
vs. NOGALES MINING COMPANY ET AL. 
 
 Answer Without 
 Exhibits 
 
 In the District Court of the First Judicial District of 
 the Territory of Arizona, in and for the County of Santa 
 €ruz. 
 
 H. K. Chenoweth and W. F. Ghenoweth, Plaintiffs, 
 
 Nogales Mining Company, a Corporation, R. A. McPher- 
 
 son, Ray Ferguson, R. i^. ojoan, C. O. Richards and 
 
 Jesse R. Grant, Defenaants, 
 
 Now come defendants, Nogales Mining Company, a cor- 
 poration, Ray Ferguson and C. O. Richards, and answer- 
 ing in the above entitled action, allege as follows: 
 
 Answering paragraph one of plaintiffs' complaint, ad- 
 mit the truth thereofs 
 
 Answering paragraph two of said complaint, defenl- 
 ants are informed and believe and therefore allege, that 
 one Maldonado and others, the names of whom these de- 
 fendants are at present unaoie to ascertain, were tne 
 owners of the "Zaragoza" mine or mining claim, situated 
 in Curcupe, District of Magdalena, Sonora, Mexico. That 
 
22 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 plaintiffs did not own said mining claim, as alleged in- 
 said complaint, but that cxie truth of the matter is, that 
 R. A. McPherson obtained an optional contract for the- 
 purchase of the said claim, and that he, the said McPher- 
 son, entered into an agreement with these plaintiffs and 
 Jesse R. Grant, agreeing that if they, the said plaintiffs 
 and said Jesse R. Grant would assist him in 
 carrying out his contract with the said Mal- 
 donado for the purchase of the said mining claim, 
 that he would give to each of them a one-fourth interest 
 in said mining claim. 
 
 That it is true that thereafter the Nogales Mining 
 Company was incorporated and that said mine was con- 
 veyed to said corporation; but that it 5s not true that 
 plaintiffs thereafter expended large sums of money and 
 performed much labor in the development of said min-^ 
 ing claim. The truth of the mafter is that plaintiffs never 
 did expend at that time or at any other time, any sum of 
 money whatever or perform any labor in the develop- 
 ment of said mining claim, for tne -act is that there never 
 has, at any time, been any work done or labor performed 
 in the development of tue said Zaragoza mining claim. 
 
 That about the time said Nogales Mining 
 Company was organized, Jesse R. Grant ar- 
 ranged with Charles B. Richards for forty tnou 
 sand dollars to be used in the development of 
 said mining claim; that of this amount, about ten 
 thousand dollars was actually furnished to said com- 
 pany, and development was done on what is now the 
 Nogales mining claim to the extent of about three 
 thousand dollars. That defenaants do not know, and 
 therefore can not say at .ae present time, what was done 
 with the remainder of tne said ten taousand dollars; that 
 
vs. NOGALES MINING COMPANY ET AL. 23 
 
 at the time the said development was done on the saia 
 Nogales mining ciaim, as aforesaid, defencants believe 
 from information, and therefore allege the fact to be, 
 that the plaintiffs and Grant and McPherson honestly 
 believed that the Nogales mining claim was a part of the 
 said Zaragoza mining claim; that thereafter plaintiffs 
 objected to the arrangement which had been made by 
 Jesse R. Grant with Charles B. Richards, as aforesaid, for 
 the furnishing of the said forty thousand dollars, and 
 that the plaintiffs, solely upon the credit of the corpora- 
 tion, and not at all upon their personal credit as alleged, 
 borrowed the sum of fifty thousand dollars from Mrs» 
 Henrietta Stuart, through her agent R. E. Doan, above 
 named defendant; that the said defendants, Jesse R. 
 Grant and R. A. McPherson agreed to this last loan, with 
 the understanding that the said ten thousand dollars 
 advanced by Charles B. Richards, be repaid to him, and 
 that thereafter the said Jesse H. Grant, in order to re- 
 lease himself from the contract entered into *'ith tlit; 
 said Charles B. Richards, transferred to the said 
 Charles B. Richards one-fourth of his, said Grant's, 
 stock in the Nogales Mining Company, and did refund 
 and repay to the said Charles B. Richards the said ten 
 thousand dollars by him, the said Richaras, rurnisaei 
 as above stated; that out of the said fifty thousand 
 dollars borrowed from the said Mrs. Stuart by the 
 Nogales Mining Company, the said Grant was rurnlshea, 
 on March 4th, 1900, the said money so repaid to the 
 said Charles B, Richards; that the said money sso 
 furnished appears to be the first money or the san'i 
 fifty thousand dollars borrowed from the said Mrs. 
 Stuart, as shown on page seventeen of the minute book 
 of the said Nogales Mining Company. Further, it ap- 
 
24 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 pears from the account of W. F. Chenoweta, rendfreu 
 October 4th, 1900, that there was twelve thousand five 
 hundred aoilars in money raised by the sale of stock. 
 Defendants deny that during the month of April, 1901^ 
 or ai any time prior thereto, plaintiffs had the largest- 
 interest or" greatest investment in said corporation, 
 and allege that the greatest interest that the plaintiffs 
 ever owned in saia corporation was one-half of iUe 
 stock, that being at about the time the company was 
 organised; that defendants are informed and believe and 
 therefore allege that -c is noi true that from time ta 
 time at lue will of said plaintiffs, shares of stock of 
 said corporation were issued to different persons tc 
 secure their service in assistance of the promotion of the 
 said corporation. Defendants deny that in ihe month of 
 April, 1901, the total amount of stock in said corporation 
 that had been issued as shown by the books of thr 
 company was nineteen thousand five hundred and nine 
 shares, and allege that, as shown by said books, the 
 amount of stock so issued was only eleven thousand 
 eight hundred and forty shares, as iS snown by the 
 following certificates in said stock book, towit: Certifi- 
 cate No. 1, ten shares; No. 2, ten shares. No. 3, ten 
 shares; No. 4, ten shares; No. 5, thirteen hundred 
 and ninety shares; No. 6, thirteen hundred and ninety 
 shares; No. 7, thirteen hundred and ninety shares; No 8, 
 thirteen hundred and ninety shares; No. 9, cancelled; No. 
 10, eight hundred; No. 11, cancelled; No. 12, fifty shares; 
 No. 13, fifty shares; No. 14, fifty shares; No. 15, fifty 
 shares; No. 16, forty shares; No. 17, two hundred and forty 
 shares; No. 18, three hundred and twenty shares; No. 19, 
 eleven hundred shares; No. -20, ten hundred and fifty 
 shares; No. 21, four hundred shares; No. 22, four hun- 
 
vs. NOGALES MINING COMPANY ET AL. 25 
 
 dred shares; No. 23, one hundred and twenty-five shares; 
 No. 24, one hundred and twenty-five shares; No. 25, one 
 hundred shares; Nos. 26, 27, 28, 29 and 30, not issued; 
 No. 31, thirteen hundred and forty shares; Nos. 32, :.5, 
 34, 35 and 36, not issued; Nos. 37, 38, 39 and 40, certi- 
 ficates taken from the hook ana no notation or record on 
 stub, being a total of eleven thousand eight hundred 
 and forty shares as above stated. It is not true that of 
 the shares issued up to April, 1901, plaintiffs jointly were 
 and still are the owners of 7,600 shares, but the truth 
 of the matter is that there was issued to plaintiffs prior 
 to April j-cii, 1901, three thousand eight hundred and 
 fifty shares. On April 12th, 1901, plaintiffs sold to Jesse 
 R. Grant, for the consideration of five thousand dollars, 
 all of their stock except seven hundred shares out of an 
 alleged issue of fifty thousand shares (which were never 
 issued except in part), which interest they had previous- 
 ly disposed of. (Reference is hereby made to "Exhibit 
 B" in plaintiffs' complaint). It is not true that in July, 
 1900, plaintiff W. F. Chenoweth was elected manager 
 of said company and was empowered and instructed to 
 conduct the development of the claim belonging to the 
 said company to erect the necessary buildings, mill, ma- 
 chinery and pumping plant and other improvements 
 thereon, but the truth of the matter is, that on March 
 9th, 1900, W. P. Chenoweth entered into a contract with 
 the corporation, for a consideration of thirty-five thou- 
 sand dollars, to construct a twenty-stamp mill, full and 
 complete on the grouna, and in running order and 
 first-class in every particular, including a pumping-plant 
 and pipe line from Santo Domingo river sufficient to sup- 
 ply ample water for said mill and mine. (A memor- 
 
26 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 andum for the contract more lully appears on page 
 fifteen in the minute booK of tne Nogales Mining Com- 
 pany.) It is not true tnat W. F. Chenov/eth devoted his 
 entire time and attention to the aevelopment of the said 
 mining claim untix April, 1901, for the truth of tbe 
 matter is that there never was, nor is there now, any 
 development work on the said Zaragoza mining claim 
 owned by the said corporation claim; it is not true that 
 plaintiff, H. K. Chenoweth, devoted any of his time 
 whatsoever in securing money, and it is not true that 
 said H. K. Chenoweth or anyone else expended any 
 money whatever on sai^ mining claim in its develop- 
 ment, or in the erection of a mill, pumping plant or 
 machinery, for the reason, and the truth of the matte? 
 is, that W. F. Chenoweth nad prior to that time, entered 
 into a contract with the Nogales Mining Company, ai5 
 above stated, to erect a mill, pumping plant and ma- 
 chinery. It is not true tnat in the neighborhood of 
 eighty thousand doilars was spent for the erection of a 
 mill, pumping plant, machinery and other improve- 
 ments, for the truth of the matter is that the erection of 
 the mill and pumping plant was let by contract to W. F. 
 Chenoweth as above s.atea, for thirty five thousand dol- 
 lars, and that all .he other improvements would not 
 exceed in value or cost of construction, five hundred 
 dollars. It is true there arose between the plaintiff and 
 other stockholders of said corporation a very serious 
 disagreement as to the management of said corjyora- 
 ation, as will be more fully set out hereafter, but it is 
 not true that Grant in any way represented any stock- 
 holders whatever except himself. I'he iruth of the mat- 
 ter is that on March 2S.^, 1901, a majority of the stock- 
 holders, through the Secretary of the said corporation, 
 
vs. NOGALES MINING COMPANY ET AL. 27 
 
 called a meeting of the stockholders for the purpose of 
 electing new Directors of the said corporation, and the 
 following directors were elected on April 10th, 1901, to- 
 wit: James A. Cooper, H. K. Chenoweth, R. A. Mc- 
 X ..erson, Ray Ferguson, ^..anes O. Richards; and the 
 following officers were elected at the meeting of the 
 Directors held the same day, towit: James A. Cooper, 
 President; H. K. Chenoweth, Vice-President, Ray Fergu- 
 son, Secretary ana Treasurer anu Charles O. Richards, 
 Manager. It is true that on April 12th, 1901, plaintiffs 
 and defendants, ^ esse R. Grant ana James A. Cooper, did 
 enter into the said contact set out in plaintiffs "Ex- 
 hibit A." It is also true that defendant Grant did enter 
 into the contract in plaintiffs' complaint marked "Ex- 
 hibit B;" but it is not true that relying upon the prom- 
 ises made by Cooper and Grant in the said agreement 
 plaintiffs resigned ^.rom their offices, for the truth oi 
 the matter is that at the time said contract marked "Ex- 
 hibit B" was executed, H. K. Chenoweth was the only 
 one of these plaintiffs wno was a director in said cor- 
 poration, and that at che time si^.a contract marked "Ex- 
 hibit B" was executed, selling all the stock that the said 
 plaintiffs owned in the said Nogales Mining Company, 
 then, at that time, said H. x^. Chenoweth, being no 
 longer a stockholder in said corporation, did resign. It 
 is not true, as plaintiffs allege, that relying and be- 
 lieving in good faith tnat defendant Grant would fulfill 
 his promise to plaintiffs and woula settle all the o.^.xga- 
 tions of the said company, and would pay for plaintiffs' 
 interest as stipulated in said agreement, "that plain- 
 tiffs have fulfilled every part ot their agre€ment," for 
 the truth of the matter is, as is shown in "Exhibit B^* 
 in plaintiffs' complaint that the said Grant did pay five 
 
28 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 thousand dollars in cash for piaintifcs' stock; it is 
 not a fact that plaintiirs have fulfilled every part of 
 their agreement set out in "Exhibit A" in plaintiffs' 
 complaint; the >.ruth of the ma..er is, that notwithstand- 
 ing the fact cxiat plaintiffs' contract and guarantee in 
 "Exhibit A," referred to, that the business of the Cerro 
 Prieto Mining Company is not mortgaged nor hypoth- 
 ecated nor transferred to any person but is entirely 
 free from all debts ana ail obligations. The fact is ihat 
 long prior to lue 12th ^ay of October, 1901, that C. 
 Ramirez had instituted suit in the courts of Mexico and 
 had attached all the property of .ae Cerro Prieto iVxining 
 Company, ana that Mrs. rlenrietta Stuart had also enter- 
 ed suit in the Mexican courts an^ also had attached all 
 the property of the v^erro Prieio Mining Company, anl 
 that the Nogales Mining Company had brougat suic in 
 the Mexican courts lor the consolidation of all the prop- 
 erty of the Cerro Prieto Mining v^ompany witn t-at oj^ 
 the Nogales Mining Company, as will more fully appear 
 by defendants' "Exhibit A" attached hereto and made a 
 part hereof. Defendants allege that defendant urant ii- 
 now ready and has ai, all times heretofore oeen ready 
 and willing to pay to t.-e said plaintiffs the said thirty 
 thousand dollars mentioned in 'Exhibit A" in plain- 
 tifis complaint, and will pay to said plaintiffs the said 
 thirty thousand dollars, as soon as plaintiffs can fully 
 comply with said contract. It is true that at the annual 
 meeting of stockholders the above named deiendants in 
 this cause were elected Directors; but it is not true that 
 the defendant Grant had no intension of performing his 
 agreement in the contracts entered into and had 
 conspired with other defendants to exclude plaintiffs 
 from all the profits and advantages of this corporation, 
 
V3 NOGALES MINING COMPANY ET AL '2& 
 
 :and that he deceived them and got them off the Board of 
 Directors to gain, with other aeiendants, personal con- 
 trol of said corporation to wreck the corporation and to 
 become himself, with other of said defendants, sole 
 owners of tne property of said corporations, for the 
 truth is that defendant vjrant entered into said contract 
 referred to with a bona fide intention of pertorming his 
 agreement, and taat he is now ready to pay the said 
 thirty thousand dollars to the said plaintiffs as soon 
 as they comply with their part of said contract and that 
 he, said Grant, has paid out auout twelve thousand dol- 
 lars of debts of said corporation, that being all of the 
 debts of the said corporation that the company has ever 
 acknowledgea. And in every particular, the said defend' 
 ant. Grant, has complied with said contract, and is now 
 willing, ready and waiting to comply fully with his part. 
 It is not true that defendant. Grant, with others of said 
 defendants tried in any way to deceive plaintiffs and get 
 them off the Board of Directors or to wreck said corpora 
 tion and to become himself, with others of said defena 
 ants, sole owners of said corporations. It is not true 
 that at the time of tne election of the defendants as 
 Directors of said corporation, defendant R. E. Doan 
 was owner of 2340 shares of issued stock and McPiier- 
 son one share of issued stock, and that Grant was 
 owner of 1408 shares of issued stock, for the truth is 
 that Doan hela 1120 shares, MePherson held ten shares 
 and Grant held 5246 shares, and that there was rep- 
 resented at said meeting, by proxy and in person, 10,- 
 690 shares out of a totai of 11,490 issued. 
 
 Answering j^aragraph three of plaintiffs' complaint, 
 defendants deny absolutely all of said paragraph in toto, 
 and state the truth to be that W. F. Chenoweth has noi. 
 
30 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 made an accounting to the company as Manager of said 
 corporation since January 1st, 1901, although he has been 
 requested in writing by the Treasurer of said corpora- 
 tion, and verbally, by the manager of said corporation, 
 to render such an accounting. Defendants allege that 
 on January 12th, 1901, W. F. Chenoweth, Manager of said 
 corporation, did file a statement of his account, purport- 
 ing to be his account from October 4th, 1900, to January 
 1st, 1901, that said statement was left in his, said Chenor 
 weth's hands, he being at that time the custodian of 
 the books and papers of che said corporation, lie being 
 the acting Secretary of said corporation in the ab- 
 sence of the Secretary, and that thereafter and during 
 the month of March, 1901, the Secretary of the said cor- 
 poration, Jesse R. Grant, demanded of the said W. V. 
 Chenoweth all the books and papers of the said cor- 
 poration; and that the said Chenoweth did deliver to the 
 said Grant the minute book, the stock uook and a few of 
 the papers, but that the said Chenoweth failed to turn 
 over to the Secretary many of the most important papers 
 of the said corporation, among them being this alleged 
 account rendered on January 12th, 1901. The only two 
 accounts of the said Chenoweth that were ever de- 
 livered to the Secretary, or that have since been re- 
 ceived from said Chenoweth by the said Secretary, 
 (copies of which said accounts are hereto attached and 
 marked "B" and •C" ana made a part of this answer) 
 are indefinite, unintelligible and totally insuflacient, and 
 do not show where or for what purpose the company's 
 money was spent. 
 
 It is not true that said corporation is in- 
 debted to plaintiff W. F. Chenoweth, in the sum of $3,- 
 833.35, or in any other sum wnatever; but the truth of 
 
vs. NOQALES MINING COMPANY ET AL. 31 
 
 the matter is that we are informed ana oeileve that the 
 •said plaintiff, \v. F. Chenowem, is indeMea to the cor- 
 poration in a large sum, the exaei amount of wnich, de- 
 lendants can not at tnis time, state, but that the de- 
 fendant, the Nogales Mining Company, has instituted a 
 suit in the District Court of the First Judicial District of 
 the Territory of Arizona, at Nogales, in Santa Cruz coun- 
 ty, praying an accounting of the said W. F. Chenoweth 
 (a copy of which said complaint is marked "Exhibit 
 D," attached hereto and made a part hereof); and that 
 these defendants stancl ready and willing to pay the 
 said plaintiff any and all monies due him at any time the 
 said plaintiff renders a lair and clear account, together 
 with vouchers covering all the expeditures of money 
 placed in his hands as an officer of said corporation, if 
 such account shows said corporation is indebted lo 
 said plaintiff. 
 
 Answering paragraph four of said complaint, defemi- 
 ants admit that Henrietta Stuart holds notes of said cor- 
 poration aggregating sixty-three thousand five hundred 
 dollars, and mat C. Ramirez holds a note purporting to 
 be of the Nogales Mining Company for five thousand 
 dollars; defendant denies that the said corporation owes 
 W. F. Chenoweth any sum whatever. Defendants admit 
 that the said corporation was indebted in small amounts 
 contracted under the management of plaintiff, W. r . 
 Chenoweth, for labor, supplies and borrowed money, ag- 
 gregating some twelve thousand dollars; which said in- 
 debtedness has been fuily paid off and satisfied. Defend- 
 ants admit that there has been partly erected and part- 
 ly equipped a twenty-stamp mill and pumping plant un- 
 der a contract of thirty-five thousand dollars, herein- 
 before referred to; but that all other improvements, in 
 
32 PAPERS IN THE CASE OF CHENOWETH ET AL. » 
 
 the way of buildings, and mining implemenLS owned oy 
 the said corporation did not exceed in value one tnou- 
 sand dollars at the ame said plaintiff relinquished th3 
 management of said corporation. Defendants deny ...at 
 if said Zaragoza mining claim is properly developed it 
 is of ample value to pay all indebtedness of said cor- 
 poration, and state the truth to be that the said Zaragoza 
 mining claim is absolutely valueless as a mining ciaim, 
 as will De more fully set out hereafter. Defendants deny 
 that the directors of said corporation have rrauaulently 
 conspired to freeze out plaintiffs from all the benefits 
 of the said corporation, and that the defendants used the 
 contract described herein to obtain control of sa^- cor- 
 poration and ils property in bad faicn; but the truth of 
 the matter is that the present management was m con- 
 trol of the corporation before the execution of the said 
 contract; an^ the said contract was executed with a 
 bona fide anu honest intention as above stateG. T3e- 
 fendants deny that they intenaed or now intend the 
 destruction Oi. the said corporation or to cause the sale 
 to themselves or to a corporation organized by them 
 selves of any of the property of said corporation, and 
 deny that they procured Henrietta Stuart to institute an 
 attachment suit in the courts of Mexico and levy an at- 
 tachment upon the property of the said corporation, and 
 state the truth to be mat tne defendants have done and 
 are doing everything in their power to pay off all l\>3 
 debts of the said corporation and to protect all the stock- 
 holders of said corporation, and that the defendant, No- 
 gales Mining Company, is vigorously defending the at- 
 tachment suit ot Henrietta Stuart in the Mexican courts. 
 Defendants deny that they mortgaged all the property 
 to defendant, CO. Richards, for the purpose of having 
 
vs. NOG ALES MINING COMPANY ET AL. 33 
 
 the same foreclosed, but the purposes of the same will 
 be more fully explained hereafter. Defendants allege 
 that the by laws of the Nogales Mining company, adopt- 
 ed at the last annual meeting, do provide for special 
 meetings of the stockholders Oj. the said corporation 
 and for the election of Boards of Directors. Defendants 
 deny that they are arranging to transfer by deed or 
 otherwise any of the properties of said corporation to 
 a new corporacion or to anyone else whomsoever; but 
 that the defendants are doing, as above stated, every- 
 thing in their power to pay the debts and to protect the 
 stockholders of said corporation. Defendants deny that 
 the plaintiffs represent, in their application herein made, 
 a majority of the stockholders of the said corporation, 
 or any of the stockholders whomsoever; and allege 
 that under the by laws of the said corporation a meet- 
 ing of the stockholders could legally be held upon fif- 
 teen days' notice and a new Board of Directors legally 
 elected, and that the said directors and defendants stanu 
 ready and willing at any time to call a meeting of the 
 stockholders of said corporation for the election of a 
 new Board of Directors whenever application is made to 
 Lhem by a stockholder or stockholders owning one- 
 fourth of .-e stock of said corporation. 
 
 In answer to paragraph five of said complaint, defen- 
 dants deny the same in toto. 
 
 The defendants allege the truth concerning the No- 
 gales Mining Company, that actions of the plaintiffs 
 while they were directors and managers of the said cor- 
 poration and since, and the actions of the present Board 
 of Directors since they have had charge, to be as fol- 
 lows: 
 
 That pnor to the organization of the Nogales Mining 
 
34 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 Company, during the month or July, 1899, Jesse R. Grant 
 being then one of the owners of the Zaragoza mine, 
 or having an interest in the bond or optional contract 
 held by McPherson, for himself and on behalf of the two 
 plaintiffs in this case ana R. A. McPherson, entered into 
 a contract with Charles B. Richards, the exact terms 
 of which said contract these defendants do not know, 
 further than that the said contract was for the purpose 
 of raising money to develop the Zaragoza mine and to 
 build a mill. The said Charles B. Richards was to fur- 
 nish the then co-partnership forty thousand dollars and 
 was to have a controlling interest in a, corporation 
 thereafter to be formed for the purpose of owning and 
 working the Zaragoza mine; and relying upon the said 
 contract, he sent his expert, C. O. Richards, to Mexico, 
 to examine the property of the said plaintiffs and J. R. 
 Grant ana R. A. McPherson, and the said C. O. Richards 
 was shown the Zaragoza and what is now the Nogales, 
 the Grant and the Cerro Prieto mining claims, as being 
 the property owned by the said plaintiffs and Grant and 
 McPherson. That on the favorable report made by C. 
 O. Richards, sums of money were advanced by the said 
 Charles B. Richards to the amount of about ten thou 
 sand dollars. That on August 3rd, 1899, the Nogales 
 Mining Oompany was organiz^v- by Jesse R. Grant, H. 
 K. Chenoweth and A. Hampton in Nogales, Arizona. The 
 said corporation acquired tne ownership of the Zaragoza 
 mine by deed from McPherson. That these plaintiffs, 
 for some reason unknown to these defendants, did not 
 desire to carry out their contract made with Charles B. 
 Richards, and entered into negotiations with Mrs. Hen- 
 rietta Stuart of Washington, D. C, for the loan of mon- 
 ey; and that during the month or January, 1900, Dr. C. 
 
V?. NOGALES MINING COMPANY ET AL. 35 
 
 "Whitehead, United States chemist and assayer, examined 
 the property of the Nogales Mining Compapy and was 
 shown the Zaragoza, Nogales, Grant and Cerro Prieto 
 claims, aind it was represented to him by the corporation 
 or by directors or agents, that tihese claims were owned 
 by the Nogales Mining Company. That upon his exam- 
 ination, Mrs. Henrietta Stuart, through her agent, R. 
 E. Doan, agreed to loan the corporation the sum of fif- 
 ty thousand dollars; but the said fifty thousand dollars 
 was not paid over until Major James A. Cooper, who 
 wap sent by Mrs. Stuart to examine the property of thb 
 Nogales Mining Company. That when Major Cooper 
 went to examine the property he was shown by tlhe 
 plaintiffs in this action, the Zaragoza, the Nogales, the 
 Grant and the Cerro Prieto mines, and it was represent- 
 ed to him that the Nogales Mining Company was owner 
 of all the above mentioned claims and upon his favor- 
 able report the money was aid over to the Nogales 
 Mining Company. 
 
 On the 12th day of January, 1900, W. F. Chenoweth, 
 H. K. Chenoweth, Jesse R. Grant ana R. A. McPherson 
 organized a corporation called the Cerro Prieto Mining 
 Company, under the laws of Mexico, in Nogales, Sonora, 
 Mexico. Thereafter, on or about Marcb 12th, 1900, Jesse 
 R. Grant transferred to the Cerro Prieto Mining Com- 
 pany the Nogales and Cerro - rieto mines, in considera- 
 tion of twenty-five shares of stock, said stock bein^' 
 one-fourth or the capital stock ot the said Cerro Prieto 
 Mining Company, and H. K. Chenoweth aeeded to said 
 Mexican corporation the Grant and Elisa claims, and 
 received in consideration therefor, twenty-flve shares 
 of stock of the said Mexican corporation. ^. F. Cheno- 
 weth ana R. x^. Mcir'herson each received twenty-five 
 
36 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 shares of the stock of said corporation, for which they 
 are supposed lo ^-ave paid twenty-five hundred Mexican 
 dollars, each. 
 
 1 ixese defendaints are informed and believe and there 
 fore allege the fact to be, -that the plaintiffs m tins ac- 
 tion did honestly believe that the ground that was 
 shown Mr. Richards and Mr. Whitehead actually belong- 
 ed to the Nogales Mining Company. That all the devel- 
 opment work done up to January 1st, 1900, was done 
 on ground whicn is now the Nogales claim and outside 
 the boundaries of t.-e /jaragoza claim. That during 
 the month of January, 1900, a re-survey of the Nogales 
 Mining Company's property was made, and it was as- 
 certained by that re-survey that the Zaragoza mining 
 claim did not cover the ledge and that there was practi- 
 cally no available ore on the Zaragoza claim. That there- 
 after, on January, ,2nv., 1900, Jesse R. Grant denounced 
 the Nogales claim, and on January 11th, 1900, the Cerro 
 Prieto claim. That on January 19th, 1900, H. K. Uxieno- 
 weth aenounced the "Elisa" claim, and on January 20th, 
 1900, the "Grant" claim, all of which said above mention- 
 ed Claims have since been conveyed to tihe Cerro Prieto 
 Mining Company. These defendants are informed and 
 believe and therefore allege the fact to be that the cost 
 of txie denouncement of the "Nogales", the "Graot", 
 the "Cerro Prieto" and the "Elisa" mining claims, that 
 the cost or the survey of the said mining claims, ti^at 
 the money expended in procuring the patents for these 
 said mining claims, that the money expended for the or- 
 ganization of the Cerro Prieto Mining Company and that 
 all of the development work done on these mining 
 claims was paid for by the Nogales Mining Company 
 while these said plaintiffs were managers and directors 
 
vs. NOG ALES MINING COMPANY ET AL. 37 
 
 tliereof. That the mill and pumping plant were erected 
 by these plaintiffs while they were directors and had 
 control of the Nogales Mining Company, and with the 
 Nogales Mining company's money, for the express pur- 
 pose of working the ores of the Cerro Prieto Mining 
 Company, and these defenuants are informea and T3e- 
 lieve, and therefore allege the fact to be that the object 
 of these plaintifte in bringing this suit and asking for 
 a receiver, is tor the sole purpose of having the proper- 
 ty of the Nogales Mining Company sold at public sale 
 at a sacrifice, and boughi in by the Cerro Prieto Mining 
 Company. That the note alleged to have been given by 
 the Nogales Mining Company to C. Ramirez was for the 
 purchase of an alleged mining claim called the 
 "Ocampo", which said aueged mining claim was deedeij 
 to W. F. Chenoweth, personally, and does not cover any 
 part of the Zaragoza claim, but as shown upon the map 
 marked "Exhibit E" and attached hereto, covers the No- 
 gales, the "Grant ana part o^ the "Cerro Prieto" 
 claims. , 
 
 These defendants are informed and believe, and 
 therefore allege the fact to be that a cash payment wia& 
 made to C. Ramirez by these plaintiffs out of the Noga- 
 les Mining Company's money, the amount of which these 
 defendants are unable to state, but believe it cO be either 
 $500.00 or $1000.0w. These defendants are informed 
 and believe and therefore allege the fact to be that dur 
 ing the time that the plaintiffs in this case were mana- 
 gers and directors of the Nogales Mining Company, and 
 during the time they run the mill heretofore referred to, 
 they went in debt at the rate of two thousand dollars per 
 month. That jUst prior to January 12th, 1901, and while 
 the said Nogales Mining company was still being man 
 
 I 
 
38 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 aged by the plaintiffs in this action, the said company 
 became unable to pay its running expenses, ' and very 
 much embarrassed financially; and for the purpose of 
 raising funds to meet the current indebtedness and to 
 continue the work of the Nogal«s Mining Company a 
 meeting of all the stockholders was held in Nogales, 
 Arizona, on January lz.th, 1901, at which said meeting 
 all the stockholders of the Cerro Prieto Company were 
 present, together with those of the Nogales Mining Com- 
 pany. At this meeting a contract was entered into 
 between the Nogales Mining Company and all the stock- 
 holders of tJhe Cerro Prieto Mining Company, the effect 
 of which said agreement was, that in consideration of 
 twenty-one thousand shares of the stock of the Nogales 
 Mining oompany, tne siock holders of the Oerro Prieto 
 Mining Company agreed and obligated themselves to 
 deed to me Nogales Mining Company ail the property 
 of the v^erro Prieto Mining Company. That upon the 
 faith of thiS contraci the Nogales Mining Company pro- 
 cured another loan of $8,500.00 from Mrs. Henrietta 
 Stuart. That at this said meeting the plaintiff, W. F. 
 Chenoweth represented and stated to -the stockhold,.rs 
 of the Nogales Mining Company that tlie mill or the 
 said Nogales Mining Company was running, and t'jat 
 there were large bodies of ore on the Cerro Prieto Min- 
 ing Company's property, and that with the $8,500.00 to 
 pay off the pressing bills of the Nogvi.Ies Mining Com- 
 pany, that the said Nogales Mining Company would 
 not need any further loan and wou.d be self-sustaining 
 and become a paying proposition. That notwithstanuint; 
 this statement, on April 12, 1901, aft^r these plalntifts 
 had been in full charge of all the property of the Noga- 
 les Mining Company for three months, and after having 
 
vs. NOGALES MINING COMPANY ET AL. 39 
 
 Tun the mill for that time, and after ha; ing receivea 
 the said loan of $8,500.00, said No^ales Mining Company 
 was in a worse condition than on January 12th, 190L 
 That the contract above referred to, executed by the 
 stockholders of the Cerro Prieto Mining Company was 
 never turned over to the N^gales Mining Company by 
 the plaintiff, W. F. Cheno^eth, who was manager ana 
 acting Secretary of said Nogales Mining Company, un- 
 til April 12, 19D1, ana that these defendants are informed 
 and believe, and allege the fact to be that the said con- 
 tract is now in the hands of the plaintiffs, W. P. Cheno- 
 weth. Defendants are reliably informed and believed and 
 therefore state the fact to be, that Jesse R. Grant and R. 
 A. McPherson, two of me stockholders, and who own 
 one-half of the stock of the Cerro Prieto Mining Compa- 
 ny, are willing and ready to fulfill their agreement re- 
 ferred to ; that is to say, to transfer to the Nogales Min- 
 ing Company au their interest and stock in the Cerro 
 Prieto ivxining Company, and that it is within the power 
 of the plaintiffs in this action, who own the other half 
 of the stock of the said Cerro Prieto Mining Company 
 to fulfill their part of the above said contract by deeding 
 their interest in the sa-a company, and to transfer their 
 stock in said company to the iNOgales Mining Company, 
 but for some reason, unknown to these defendants, they 
 refuse so to" do, although the said Nogales Mining Com- 
 pany are ready and wining to tully carry out its part 
 of said contract 
 
 That on April 12th, 1901. C. O. Richards took posses- 
 sion of the property of the Nogales Mining Company 
 as Manager, and made a report a short time thereafter 
 to the stockholders of the said company showing the 
 condition of the company's property, a verified copy of 
 
40 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 which said report is attached hereto, marked "Exhib't 
 F" and made a part hereof; that as shown by said re- 
 port, it was absolutely necessary to borrow money to 
 put the mill and mine in working condition; that a. 
 mortgage was executed by the Nogales Mining Company 
 to C, O. Richards, and the said C. O. Richards loaned to 
 the company the sum of $15,000,00. 
 
 That a short time thereafter C. Ramirez entered suit 
 in the Mexican courts on the note above referred to aua 
 attached the property of the Nogales and the Cerro 
 Prieto Mining Companies; that immediately following 
 this attachment, Mrs. Henrietta Stuart brought suit in 
 the Mexican courts and attached all the property of the 
 Nogales and Cerro ir'rieto Mining Companies; that both 
 of the above said attachment suits are being defended 
 by the Nogales Mining Company, in order to protect the 
 Nogales Mining Company and in order to keep the mill 
 running and to enable the Nogales Mining Company 
 to pay off its debts; and in order to block said attacn 
 ment suits and for no other purpose whatever, C. O. 
 Richards brought suit in the Mexican couris to rore 
 close his said mortgage on the property of the Nogalea 
 Mining Company; that said foreclosure suit is not being 
 prosecuted at the present time but is being permitted t-^ 
 drag for the sole purpose of holding off the attaching 
 creditors, and to keep the mill running as above stated, 
 and to enable the Nogales Mining Company to pay off 
 the above said creditors. 
 
 That on the 5th day of October, 1901, the Nogales Min- 
 ing Company brought suit in the Mexican courts for 
 specific performance of the contract above referrcMi to, 
 executed by the stockholders oi ine Cerro Prieto Mining 
 Company on January 12th, 1901, a copy of the com- 
 
vs. NOG ALES MINING COMPANY ET AL. 41 
 
 plaint of which said suit is marked "Exhibit A," at- 
 tached hereto and made a part hereof. That this said 
 suit is being vigorously defended by the plaintiffs in 
 this case. 
 
 Tbat the present condition of the Nogaies Mining 
 Company is not such as is represented by the plaintiffs 
 in this action, but in truth and in fact is as follows: \.\\l' 
 Zaragoza mining claim has no available ore upon it so 
 far as known; the mill, pumping plant and tools belong- 
 ing to the said Nogaies Mining Company, if sold, would 
 not bring to exceed $10,000, nor would they be worth to 
 exceed $10,000 to anyone except the Cerro Prieto 
 Mining Company. The mill and pumping plant of the 
 Nogaies Mining Company has been lately over- 
 hauled and rebuilt at an expense of ten thou- 
 sand dollars, and is now in good condition and 
 running on the ores extracted from the Cerro 
 Prieto Mining Company's mines; and if the con- 
 solidation suit above referrea to can be successfully car- 
 ried through by the Nogaies Mining Company, or if 
 these two plaintiffs will deed their interest or transfer 
 their stock in the Cerro Prieto Mining Company to th« 
 Nogaies Mining Company as they agreed to do in their 
 contract above referred to, executed on January 12th, 
 1^01, the property of the Nogaies Mining Compaiiy 
 would then be very valuable and ample to pay all its 
 debts, and all of the debts of the Nogaies Mining Com- 
 pany could then be arranged for and the company would 
 make at least three thousand dollars per month, clear 
 of all expenses. The only debts of any consequence ow^ 
 ing by the said Nogaies Mining Company are those of 
 Mrs. Henrietta Stuart and C. O. Richards, and these de- 
 fendants are informed and believed and therefore state 
 
42 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 the fact to be that the only reason Mrs. Henrietta Stuait 
 brought her attachment suit above referred to, is on ac- 
 count of these two plaintiffs in this case failing and re- 
 fusing to fulfill the obligations of their contract of Jan 
 uary 12th, 1901, above referred to. 
 
 Wherefore, These defendants pray that the bill of 
 plaintiffs be aismissed; that these defendants be per- 
 mitted to continue in control of the Nogales Mining 
 Company; that the plaintiffs in this case be ordered 
 by this court to transfer and deliver all of their stock 
 in the Cerro Prieto Mining Company to the Nogales Min 
 ing Company, and for general and special relief, these 
 defendants will ever pray. 
 
 DUFFY & RICHARDSON, 
 Attorneys for Defendants. 
 
 C. O. Richards being first duly sworn deposes and says, 
 that he is one of the defendants in the above entitl3d 
 cause; that he has read the foregoing complaint and 
 knows the contents thereof, and that tlie same Is trut: 
 of his own knowledge, except the matters therein stated 
 on information and belief, and that as to those matters 
 he believes it to be true. 
 
 C. O. RICHARDS. 
 
 Subscribed and sworn to before me this 21st day of 
 October, A. D., 1901. 
 
 (Seal) F. J. DUFFY, Notary Public. 
 
 Territory of Arizona, } 
 County of Santa Cruz. )"^^' 
 
 Ray Ferguson being ...^ly sworn deposes and says: 
 that he is one of the defendants in the above entitled 
 cause; that he nas read the foregoing complaint, and 
 knows the contents thereof, and that the same is true 
 
vs. NOGALES MINING COMPANY ET AL. 43 
 
 of his own knowledge, except the matters therein stated 
 on information and bc.^e., and that as to those matters he 
 believes it to be true. 
 
 RAY FERGUSON. 
 
 Subscribed and sworn to before me this 21st day of 
 October, A. D., loux. 
 
 (Seal) F. J. DUFFY, Notary Public. 
 
 In the District Court of the First Judicial District of 
 the Territory of Arizona, in and for the County of Santa 
 Cruz. 
 
44 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 Cross-Complaint With 
 Exhibit 
 
 H. K. Chenoweth and W. F. Chenoweth, plaintiffs, 
 
 vs. 
 Nogales Mining Company, a coporation, R. A. McPher- 
 
 son, R. E. ^oan, C. O. Ricliards, and Jesse R. Grant, 
 
 defendants. 
 
 No. 120. 
 
 Now come tlie defendants in said cause, and reiterat- 
 ing and reaffirming all of the matters alleged and set 
 forth in the answer heretofore filed by these defendants, 
 and allege as a cross-complaint herein in addition to the 
 allegations aforesaid in said answer and supplementing 
 the same, that the said plaintiffs after they had convey- 
 ed or caused to be conveyed to the Nogales Mining Com- 
 pany the mine known and described as the "Zaragoza" 
 mine, they caused the boundaries of the same to be 
 changed and altered. That when the same was located 
 and monumented, it was so located and monumented 
 that the ledge and lode bearing valuable minerals ran 
 along the center of the claim. That the same was lo- 
 ■ cated as a parallelogram, and the said lode bearing valu- 
 able mineral ran along about half way between the two 
 longest sides of the parallelogram for a distance of 
 
vs. NOGALES MINING COMPANY ET AL. 45 
 
 about 500 meters, and the said defendant company was:- 
 Organized for the purpose of the development of the said 
 mineral bearing lode or ledge and operating same as a 
 mine, and as set forth in said answer more fully, to all 
 of the said parties, the agents of the said Mrs. Stuart 
 and the said defendant Richards, and his attorney and 
 experts, the said plaintiff exhibited and ^owed that the 
 ground owned by said oefendant company was ground 
 that included the said mineral bearing lode or ledge for 
 ihe said distance of 500 meters, and all of said defen- 
 dants-parties who invested in the stock of the said de- 
 fendant company, and who loaned money to the said de- 
 fendant company, were made by the said plaintiff to be- 
 lieve, and they did believe by reason of tlie fact that the 
 said plaintiff showed the boundaries upon the ground 
 of the said claim to be such as to include the said 500 
 meters of the said mineral bearing lode or ledge, and 
 that all of the transactions of the said parties were 
 based upon the understanding that the said claim in- 
 cluded the said ledge for the said 500 meters Dased upon 
 the statements and shown upon the ground of the 
 boundaries thereof by the plaintiff. And defendants did 
 not know of the existence of any contending or con- 
 testing claim against said 500 meters of the said min- 
 eral bearing ledge, and defendants allege that as a mat- 
 ter of fact there was no contending claim or asserted 
 claim to any part of the said 500 meters of the said ledge, 
 so within the boundaries of the said Zaragoza claim. 
 
 Defendants allege that afterwards with intent and for 
 the purpose of defrauding the said defendant company, 
 and the said Mrs. Stuart, and the other investors in the 
 stock of the said company, and to deprive the said de- 
 fendant company of the ownership of the said 500 meters 
 
46 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 Of the said mineral bearing ledge, claimed and pretended 
 that the said Zaragoza claim swung so that it bore to an 
 angle accross the said mineral bearing ledge ana left 
 only 500 meters of the said mineral bearing ledge crossing 
 the corner of the said Zaragoza claim diagonally, as 
 more fully will appear by the map attached to this an- 
 swer herein filed by defendants. And afterwards for tho 
 purpose of defrauding the said defendant company, the> 
 made denouncement under the laws of Mexico, or what 
 they called the Nogales claim, across which the saia. 
 Nogales claim the said mineral bearing ledge has its 
 strike, and the Grant claim to be denounced as afore- 
 said, and the Cerro Prieto claim to be denounced as 
 aforesaid, along the middle line on which the said min- 
 eral bearing lode has its strike. And they also caused to 
 be denounced Elisa claims as aforesaid, across which the 
 said mineral bearing vein has its strike as well. The ef- 
 fect of which denouncements was if valid to destroy the 
 value of the Zaragoza Mining Claim, ana to deprive said 
 defendant company of all of its valuable mineral 
 bearing ground. 
 
 Having made this denouncement as set forth to de- 
 fraud said defendant company, they organized a corpora- 
 tion under the laws of Mexico as set out in said answer, 
 all of the stock of which was owned by the plaintiffs and 
 Jesse R. Grant and R. A. McPherson, as alleged in said 
 answer, whereby and by means whereof the said plain- 
 tiffs intended to defraud and deprive said defendant 
 company of its valuable mining ground, and to secure 
 same for themselves, by virtue of said denouncement, iii 
 the said Mexican company organized as aforesaid. That 
 when said alleged fraud was discovered by the parties 
 hereto, a contract was entered into of the uate of the 
 
vs. NOGALES MINING COMPANY ET AL. 47 
 
 12th of January, 1901, which is set forth in the answer 
 hereto, hy means of whicTi it was agreed by all of the 
 stockholders of the said Mexican company that they 
 would right the wrong and prevent the execution of the 
 fraud as against defendants nerein, by causing to be con- 
 veyed to this defendant company the said denounced 
 mining claims as aforesaid. They allege that the said 
 contract has not been executed, although they allege 
 that the said Jesse R. Grant and the said R. A. Mc- 
 Pherson as aforesaid, are ready and willing to assign 
 and transfer to said defendant company one-half of tlie 
 stock of the said Mexican company as provided for in 
 said contract, but they allege that the said plaintiffs, who 
 are the owners of half of the stock have failed and 
 refused and ^ still fail and refuse to transfer to the said 
 defendant company the same or any part thereof. And 
 defendants allege that it is now and has been ever since 
 the execution of said contract in their power to do so. 
 And defendants allege that it is their duty as aforesaid 
 under the said contract co do so and although conscience 
 and equity compel them to do so without regard to the 
 contract in order to prevent the execution of the fraud 
 attempted to be committed oy them as hereinbefore set 
 forth and as set forth in the answer aforesaid. 
 
 That in view of the foregoing facts the parties to the 
 said transaction, and all of the stockholders of the said 
 defendant company ana all of the creditors of the said 
 defendant company, except these plaintiffs, on or about 
 the 10th day of December, 1901, and sTnce the filing of 
 the answer above set forth, entered into an agreement, 
 a copy of which is made a part hereof and marked Ex- 
 hibit "A" to this cross-complaint. By the contract 
 all of the interests were sought to be protected and pro- 
 
48 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 vided for as it was believed an^ is believed by all of them 
 that the said lode of mineral-bearing ground, which was 
 the subject of this controversy, and for the operation 
 of which the said defendant company was formed, has 
 good value and sufficient to pay off all the debts of the 
 said company and make a large profit for its owners, 
 and to that enu tney have agreed as set forth in said ex- 
 hibit. That it is their wish that the receiver herein be 
 removed in order that the parties may execute and carry 
 out said contract, and in order that the said- parties to 
 said exhibit may secure ownership of said mineral-bear- 
 ing ground, as against said Mexican company and tiiese 
 plantiffs,by securing ownership of all the stock of the 
 said Mexican company. 
 
 They have also contractea that the debts of said 
 C. O. Richards and said Mrs. Stuart shall be provided 
 for and their payment postponed ai the option of said 
 company for two years, within which time the said 
 company will be able to liquidate and pay off said in- 
 debteflness in full. Thai said contract represents all ot 
 the stock of th« said defendant company, and said stock 
 has been placed in the possession of I. McManus, named 
 in said contract, for the purpose of securing a full com- 
 pliance with all the conditions thereof, and to said con- 
 tract the said Richards ana the said Mrs. Stuart have 
 consented. They deny that the. said defendant company 
 was indebted to said Dr. W. F. Chenoweth, plaintiff, 
 in any way, and they allege and assert that upon a full 
 account of all transactions of said Chenoweth as set 
 forth in his complaint, and in the answer aforesaid, and 
 as set forth in the complaint and answer in Case No. 
 114, will demonstrate that ine said W. F. Chenoweth is 
 a lai%e debtor, to-wit, of not less than $20,000, but of 
 
vs. NOGALES MINING COMPANY ET AL. 49 
 
 just what amount these defendants do nQt know, on ac- 
 count of monies which were placed in his hands as 
 Manager of said defendant company. That while Man- 
 ager of said defendant company he contracted with 
 said defendant company to erect a quartz mill 
 and water plant for the contract price of $35,000, and 
 that he was paid in full the said $35,000, and in addition 
 thereto there was some $42,000 placed in his hands by 
 said defendant company, and he states that while Man- 
 ager of the company, the directors of the company were 
 his friends, who gave personally very little attention 
 to said business, so that he was practically dealing with 
 the company's money and contracting with the company 
 and whatever accounts he rendered as Manager or as 
 contractor, were renderea to himself as above, and aud- 
 ited by himself, and these defendants say that the only 
 accounts i.e ever rendered to the defendant company 
 are the two exhibits set forth in the answer heretofore 
 filed herein, and defendants allege that said exhibits 
 are no accounting at all, as tney do not show how the 
 money was expended, to whom or what lor the same 
 was paid out. But it does not show that the funds of 
 the said defendant company were used in acquiring the 
 denouncement of L„e mining claim known as the Grant 
 above named, and therefore shows that the said funds 
 were used in acquiring title thereto and in organization 
 of the said Mexican company, and the conveying title 
 aforesaid to said Mexican conjpany was all done 
 with the tunds of the deiendant company,^ and as all of 
 the stock o- the Mexican company is owned by 
 plaintiffs and said Grant and said McPherson, the law 
 makes the said defendant company the owner in equity 
 
50 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 as a resulting trust or all stock in the said Mexican 
 coiEpany. 
 
 Defendants further allege that one C. Ramirez made 
 a denouncement of a mining claim called the Ocampo as 
 clelijieated in the map attached to defendants' answer 
 '■•erein, and in order to secure whatever title might have 
 been accrued to said grouna by virtue of said location, 
 the same was purchased by said Dr. W. F. Chenoweth 
 and the sum of $500 or $1,000 was paid in cash and as 
 a part of the purchase price out of the funds of the said 
 defendant company, and in addition thereto the prom- 
 issory noie of the said defendant company was given for 
 $5,000 to Ramirez, in consideration therefor. And the 
 said Dr. W. F. Chenoweth caused the said deed to tne 
 said Ocampo mining claim from said Ramirez in con- 
 sideration of said purchase price to be made not -o said de- 
 fendant company but to himself personally, and the said 
 Rpmirez has since that time discovered that the note of 
 the said defendant company given to him as aforesaid i& 
 without authority of said company, and he has since 
 declared in a solemn pleading before a court of competent 
 jiirisdiction in Mexico, and under oath, that the said de- 
 fendant company does not owe him a dollar in considera 
 tlou of the purchase price of the said mining claim, and 
 defendant is informed and therefore states the fact to be 
 that he has abandoned the same. 
 
 Defendants allege that they are informed and believe 
 and so state the fact to be, that the said plaintiffs are nc 
 longer stockholders of the said defendant company but 
 that they are claiming an interest in the ground form- 
 erly sold as aforesaid to the defendant company under 
 and by virtue of stock they hold in the said Mexican 
 company. 
 
vs. NOGALES MINING COMPANY ET AL. 51 
 
 Defendants therefore pray, that the said plaintiffs be 
 required to answer ciiis cross complaint under oath and 
 specifically. And that the court discharge the said re- 
 ceiver, and vacate order appointing him at their request 
 and return sa'id property to its owners and tlie stock- 
 holders of the said company, and that the said plain- 
 tiffs be required by a decree of this court to peform their 
 contract and to rignt the wrong they attempted to com- 
 mit by assigning a transfer to said defendant company 
 one-half of the stock owned and held by them in the 
 said Mexican company, and that the Court also decree 
 the amount of indebtedness of the said Dr. W. F. Cheno- 
 weth to said defendant company and render judgment 
 therefor, and for such other and further relief as is 
 agreeable to law and equity. 
 
 D. O. Richardson and Barnes & Martin. 
 
 Territory of Arizona, ) 
 County of Santa Cruz, ) 
 
 C. O. Richards and Ray Ferguson being duly sworn, on 
 oath states, that he has read the foregoing cross-com- 
 plaint and he has also read the answer filed herein and 
 above referred to, and he scates that the same is true 
 in fact except as to those matters stated upon informa- 
 tion and belief and as to those matters he believes it to 
 be true. 
 
 Subscribed and sworn to beiore me this day of 
 
 January, A. D., Iy02. 
 
 S. F. NOON, 
 Clerk District Court. 
 "A" 
 
 We, the undersigned creaitors and stockholders of the 
 Nogales Mining Company, for and in consideration of the 
 
52 PVPERS IN THE CASE OF CHENOWETH ET AL. 
 
 premises, and reiying upon the faithful fulfillment oi 
 the following contract, agree as follows, to- wit: 
 
 First, to petition Judge George R.- Davis to remove 
 receiver ot the said company, and to' this end. Individual- 
 ly and collectively to use our uest efforts. 
 
 Second, to prosecute with all haste and vigor suit for 
 consolidation of the Cerro Prieto Company of Sonora, 
 Mexico, with the Nogales company, and the transfer of 
 all the property of the former to the latter. 
 
 Third, to prosecute accounting suits against aV 
 debtors of the said Nogales Mining company. 
 
 Fourch, debts of C. O. Richards against the Nogales 
 Mining Company to be secured for twenty thousand dol- 
 lars, balance of said debt to be iioating indebtedness of 
 said company, all to bear interest at the rate of 6 per 
 cent, per annum from ^.aie of execution, interest payable 
 semi-annually. 
 
 • Fifth, debts of Mrs. H. Stewart to be secured by second 
 mortgage to bear interest at the rate of 8 per cent per 
 annum from ihe date of execution, interest payable semi- 
 annualy. 
 
 Sixth, the first mortgage of C. O. Richards and the 
 second mortgage of Mrs .H. Stewart shall be on all the 
 property of the company and shall be paid before the 
 period of two years, but it is understood that should said 
 company choose to pay said debt sooner, the said credit- 
 ors, and each of them, shall be forced to receive their 
 money, and release said mortgage. 
 
 Seventh, the stockholders agree that the interests 
 owned and represented by them are as follolws: 
 
 C. O. Richards 50 per cent 
 
 R. E. Doan 11.6 per cent 
 
vs. NOG ALES MINING COMPANY ET AL. 53 
 
 J. A. Cooper, R. A. McPherson and Ray 
 
 Ferguson, total of 15.6 per cent 
 
 A. D. Shrewsbury 12.9 per cent 
 
 Ray & Patterson, total 10 per cent 
 
 all of which said stocK the parties to this agreement 
 do hereby transfer to I. McManus, as trustee, except one 
 share of stock each. The said trustee shall have power by 
 these presents to force each party to this contract to 
 comply strictly with the terms hereof, and do hereby 
 iuthorize him to hold the stock of each party to this 
 contract until they have so complied as above stated. 
 
 Eighth, R, A. McPherson ana Jesse R. Grant do 
 hereby agree to use their best efforts to force said con- 
 solidation above referred to, and stand ready to trans- 
 fer their stocK anu all interests owned by them to the 
 No^ales company as soon as tne Court will force The 
 owners of the other half interest in said company to do 
 likewise. 
 
 Ninth, in case of any litigation whatsoever, between 
 C. O. Richards and any person whatsoever as to his 50 per 
 cent of said Nogales Mining Company stock, said C. O. 
 Richards to bear aii such expense necessitated by siuct 
 litigation personally, 
 
 Albert D. Shrewsbury. 
 
 Chas. D. Richards. 
 
 Jesse R, Grant, 
 
 By Chas. O. Richards, Attorney in fact. 
 
 James A. Cooper. 
 
 R. E. Doan. 
 
 S. A. Briggs, 
 
 By J. May Morrison, their Attorney in Fact 
 
 Ray Ferguson. 
 
 R. A. McPherson, by Ray Ferguson, Attorney in Fact 
 
54 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 We the undersigned creditors of the iNogales Mining 
 Company have read ^ the loregoing contract, and hereby 
 agree to and acquiesce in the same, and to accept the 
 conditions therein contained as applying to our claims. 
 
 Chas. O. Richards. 
 
 Henrietta Stuart, by Eb. Williams, her attorney. 
 
vs. NOGALES MINING COMPANY ET AL. 65 
 
 Answer to Cross - Complaint 
 
 In the District Court of the First Judicial District, 
 Territory of Arizona, County of Santa Cruz. 
 H. K. Chenoweth and W. F. Chenoweth, Plaintiffs, 
 
 vs. 
 Nogales Mining Company, a Corporation, R. A. Mc- 
 Pherson, Ray Ferguson, R. E. Doan, C. O. Richards 
 
 and Jesse R. Grant, Defendants. 
 
 MOTIONS AND DEMURRER. 
 I. 
 
 Plaintiffs show that defendants' cross-complaint con- 
 tains irrelevant and redundant matter, to-wit, that part 
 of the same beginning with line four on page four there- 
 of to the end thereof, together with "exhibit A" at- 
 tached thereto; that the part thereof from lino four on 
 page four thereof to line one of page five thereof is ir- 
 relevant and redundant matter in that it sets forth a 
 contract that bears no relation to plain tiffs and cannot 
 affect plaintiffs' rights or obligations, and that "exhibit 
 A" is irrelevant and redundant matter for the same rea- 
 son; that the part thereof from line one on page five 
 to line twenty on page six is irrelevant and redundant 
 matter as being not pertinent to the cross-complaint, but 
 should be incorporated in the answer to plaintiffs' com- 
 
56 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 plaint, as answer to the allegations therein: Wherefore 
 plaintiffs move that defendants be required to strike 
 the san?e from the said cross-complaint. 
 
 II. 
 
 Plaintiffs show that defendants' cross -pomplaiut is not 
 definite and certain in this, that it cannot he ascertained 
 therefrom whether it be a bill for specific performance of 
 a contract or an action for misappropriation of funds of 
 defendant company or a bill for an accounting or a bill 
 of discovery. Wherefore plaintiffs move that defendants 
 be required to make the same definite and certain. 
 
 III. 
 
 Plaintiffs demur to said cross-complaint on the 
 ground that it appears upon the face thereof that the 
 Court has no jurisdiction of the subject of the action 
 
 IV. 
 
 Plaintiffs demur to said cross-complaint on the ground 
 that if the same be a bill for specific performance of 
 contract it appears upon the face thereof that there is 
 a defect of parties defendant to said cross-complaint, in 
 that the Cerro Prieto Mining Company is a necessary 
 party thereto. 
 
 V. 
 
 Plaintiffs demur to said cross-complaint on the 
 ground that several causes of action are Improperly 
 united, towit, a bill for the specific performance of a 
 contract, an action for the misappropriation of funds of 
 defendant company, a bill of a discovery, and a bill for 
 an accounting. 
 
vs. NOGALES MINING COMPANY ET AL. 57 
 
 VI. 
 
 Plaintiffs demur tO said cross-complaint on the ground 
 that the same does not state facts suflBcient to consti- 
 tute a cause of action. 
 
 ANSWER. 
 VII. 
 
 The foregoing motions and demurrers having been 
 overruled, plaintiffs now come and for answer to the 
 cross-complaint filed in the above-entitled action re- 
 spectfully show to this (Jourt: 
 
 That it is not true that the said plaintiffs after they 
 had conveyed or caused .o be conveyed to the Nogales 
 Mining Company the mine known and described as the 
 Zaragoza mine caused the boundaries of the same 
 to be altered and changed, but that the truth is that the 
 boundaries of the said mine haa been established be- 
 fore these plaintiffs acquired any interest in the said 
 claim; that the title paper of the same had been issued 
 by the Mexican government; that under the Mexican 
 laws, before the issuance of the title paper to a mining 
 claim, the claim must be surveyed by the government 
 surveyor ana the boundaries thereof established by him 
 and a plat made of the same, a copy of which plat in 
 the case of the Zaragoza mine is of record in the proper 
 government oflSlce in the City of Mexico, a copy like- 
 wise in the city pf Magdalena, Sonora, capital of the 
 district in which tae said claim is situated, and a copy 
 whereo. is likewise attacned to the title paper as issued 
 by the Mexican government for thQ said claim. Plain- 
 tilts prior to tne time in which they purchased their 
 interest in the saiv Zaragoza minmg claim had never 
 
'58 • ' |»Ai>EIig IK THE CASE OF CHENOWETH ET AL. 
 
 been on said claim and had never seen said claim, but 
 bougnt their interest in the same solely on the recom- 
 mendation of the defenaant R. A. McPherson. Plaintiffs 
 assert that if wnen the said mine was located and 
 monumented, it was so located and monumented that the 
 ledge or lode bearing valuable minerals ran along the 
 center of the claim, plaintiffs qo not know the fact, but 
 assert upon information and beuef that the claim as it 
 now stands is as it was locateu and monumented at the 
 time ihe title papers were issued to the owner from 
 whom plaintiffs acquired their interest as bef or estate d, 
 and that no change therein has ever at any fime been 
 made. i^Mrther plaintiffs deny that to all of the said 
 parties or to any of them, the agents of the said Mrs. 
 Stuart, or to the defendant Richards, or to his at- 
 torney or experts or to any of them, they exhibited and 
 showed that the ground owned oy the defendant com- 
 pany was ground tha^ included tne said mineral bearing 
 lode or ledge for a distance of five hundred meters, and 
 that all of the said parties-defendants or any of them 
 who invested in the stock of the said defendant com- 
 pany and who loaned money to the said defendant com- 
 pany were made by the said plaintiffs to believe or did 
 believe by reason of the fact that the said plaintiffs 
 showed the bounuaries upon the ground of the sai( 
 claim to be such as to include the saia five hundred 
 meters of the said mineral bearing lode or ledge, but 
 «how the fact to be that the said plaintiffs never show- 
 ed the boundaries upon the ground of the said claim 
 to any person at any time whatsoever, nor did plaintiffs 
 themselvejs until long after the investment in the stock 
 of the saia defendant company by the said defendants 
 and the loaning of -money. by the, said creditors know 
 
VS!i^6CALfig MINING COMPANY ET AL. 59 
 
 W^ere the true boundaries oi the said claim werci Plain-, 
 tiffs lurther deny that all of the transactions of the 
 said parties wer6 base:, upon the understanding that 
 ._e said claim incluaed said ledge, for saia five hundred 
 meters or were based upon statements concerning the 
 said ground and the boundaries thereof by, the said 
 plaintiffs, but allege the truth thereof to be that the 
 plaintiffs themselves believed: at the time. ojC th«> 
 transaction referred tO in the said cross-complaint that 
 the said claim did include said .edge for said five hun- 
 dred meters and the said plaintiffs expressed said belief, 
 but that said plaintiffs did not show to any one upon 
 the ground the bounuaries of tne saia claim, apu e-.d 
 not know at the time mentioned in said cross-complaint 
 Where the said bounaaries were^ but as before statedi 
 relieu upon the representations made to them by the 
 saiu R. A. Mca herson and upon those representation;, 
 based their belief anu paid money for th^ transfer of the 
 said mining claim. Plain. .xfs allege that throughout all 
 bf the transactions connected with the matters alleged in 
 the said cross-complaint as well as all others both prior 
 to and subsequent to and contemporaneous with or in any 
 wise relating to the property m question all representa- 
 tions that plaintiffs have made have been made upon 
 honest belief in the truth of those representations .-y the 
 plaintiffs and that they nave acted in absolute faith. 
 
 Plain txfts further show that tney did not afterwards 
 with intent to and for the purpose of defrauding said 
 defendant company and ..le said Mrs. Stuart and other 
 investors in the stock of the ^aid conipany, and to de- 
 prive v-^e said company of the ownership of the said five 
 hundred meters of .he said mineral bearing ledge or lode 
 claim, pretend that the said Zaragoza claim ^wung 
 
60 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 SO mat it bore to an ang^e across the said mineral 'Gear- 
 ing lode or ledge and left only a part of the said min- 
 eral bearing lode or ledge crossing the corner of the said 
 Zaragoza mining claim diagonally, but show the truth of 
 the matter to be that in January or February, A. D. 
 1900, they were informed by the defendant Jesse R. 
 Grant, who was then Manager of the said defendant 
 company and personally preseht at the said mine and 
 in charge of the working thereof, that the said claim as 
 shown by the title papers, so bore at an angle across the 
 said mineral bearing lode or ledge, as in this said cross- 
 complaint set forth, which was the first knowledge or 
 intimation or suggestion of the fact that the plaintiffs 
 had received. Plaintiffs furtner show that the defen- 
 dant Grant at the time he conveyed this information to 
 plaintiffs likewise informed plaintiffs that he had de- 
 nounced under the Mexican laws a claim which he call- 
 ed the Nogales claim, which would remedy the de- 
 fective course of the said Zaragoza claim, which said 
 Nogales claim said defendant Grant informed plain- 
 tiffs he would transfer to the Nogales Mining Com- 
 pany as soon as the title of the said claim should be re- 
 ceived by him, provided that the company found it im- 
 possible under the Mexican laws by a resurvey so to 
 locate the said Zaragoza mining claim as to cause it to 
 cover the desired grouna. Plaintiffs deny that they de- 
 nounced the said Nogales claim but show that as be- 
 fore stated it was aenounced by the said T)laintiff Grant. 
 Plaintiffs further aeny that they denounced the said 
 Cerro Prieto claim but allege that the said defendant 
 Grant denounced the said Cerro Prieto mining claim. 
 Plaintiffs admit that plaintiff H. K. Chenoweth de- 
 nounced the Grant 'claim and the Elisa claim but allege 
 
vs. NOG ALES MINING COMPANY ET AL. 61 
 
 tlie truth as to those claims to be that neither of them 
 i& within ground trial by any location whatsoever of the 
 saiQ Zaragoza claim on the saiQ ledge or lode as alleged 
 in the said cross-complaint, cou.i be covered by the 
 said Zaragoza claim. Plaintiffs further show that the 
 said Cerro Prieto mining claim covers ground which could 
 not by any means conflict with ground that by any man- 
 ner of survey could be included Wicxiiri the said Zara- 
 goza claim, and that the Nogales claim aforesaid is the 
 only one of the said claims that covers ground that 
 could be covered by tne said Zaragoza claim if the 
 course of the said Zaragoza claim could be changed by 
 a new survey. Plaintiffs deny that the effect of the afore- 
 said denouncement was if valid to destroy the value of 
 tlie said Zaragoza mining claim or to deprive said defend- 
 ant company of all of its valuable mineral bearing ground, 
 but show the truth to be that there appears to be or 
 said Zaragoza mining claim a mineral bearing lode or 
 ledge of considerable vdlue running tlie entire length of 
 said claim aside from the ledge referred to in the said 
 cross-complaint which crosses the said claim diagonally. 
 Plaintiffs admit that at some time subsequent to the 
 aforesaid denouncement they, in conjunction with de- 
 feiidants Grant and McPherson, orgatiized a corporation 
 under the laws of Mexico called the Cerro Prieto Mining 
 COmppny, the Stock of which was owned by plaintiffs 
 and by the said defendants Grant and McPherson, but 
 deny that by meahs thereof the said plaintiffs intended 
 to defraud and deiirlve the said defendant company of it^ 
 valuable mining ground and to secure the same for 
 themselves by virtue of the said denouncement and 
 the saiQ Mexican cotnpahy organized as aforesaid; but 
 allege the trutli to be that the said Jesse it. Grant as- 
 
62 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 serted hie willingness that the title, of the Nogales. 
 claim when it should he obtained, provided as aforesaid 
 that the location of tue saiu Zaragoza claim could not 
 be amended so as to cover the ground -desired, should 
 be conveyed to the said defendant company, but re- 
 fused to convey the said Cerro Prieto claim to the said 
 defendant company and 'proposed to plaintiffs, that they 
 should unite with him and the said McPherson to or- 
 ganize a corporation to own the beforementioned. Cerra 
 Prieto, Grant and Elisa Claims, and it was with that in- 
 tention that the Said corporation was organized. 
 
 The titles of the aforesaid claims denounced by the 
 said Grant and by the said piaintiff H. K. Chenoweth . 
 were issued a few weeks prior to the 12th day of 
 January, A. D. 1901. Long prior to the issuance of the 
 said titles one Jas. A, Cooper had bought from the de-. 
 dendant R. A. McPherson all of his interest in tne said 
 Cerro PrietQ Mining Company, the said McPherson re- 
 serving, as plaintiffs are informed and believe, a lien or 
 stop upon all of the interest so sold to the said Cooper, 
 under the laws of Mexico, until , such time as the said 
 Cooper should pay in full the purchase price therefor. 
 In the organization of, the saia Cerro, Prieto Mining 
 Company the terms Of the creative act of the said cor^ 
 poration provided that the said corporation should own 
 all of the mining claims m the > district of Magdalena, iii 
 which the hereinbefore mentioned mines and mining 
 claims are situated, which should be or were owned, 4er 
 nounced or acquired in any way whatsoever by the 
 hereinbefore mentioned incorporators, by, which, terms 
 the said corporation became entitled to the. titles of th3 
 mining claims denounced by the said defendant Grant, 
 including the said Nogales mining claim, and by the 
 
vs. NOGALES MINING COMPANY ET AL. 63 
 
 said plaintiff H. K. Chenoweth. Immediately upon the 
 issuance of the titles of the said mining claims to the 
 said corporation the pla,intiff W, F. Chenoweth, as an 
 officer of the said corporation, had a proper conveyance 
 prepared by the attorney of the sdid company, to con- 
 vey the said Nogal«s claim to the said defendant com- 
 pany, whereupon the defendant McPherson interposed an 
 objection to the making of such transfer until such timo 
 as payment should be made by the aforesaid Jas. A. 
 Cooper for the said McPherson's interest in the said cor- 
 poration, and thus prevented tor the time being the pro- 
 posed conveyance. Shortly after this action by the said de- 
 fendant kcPherson there was held in Nogales, Arizona, 
 on the 12th day of January, A. D. 1901, a meeting at 
 which all of th6 stockho^aers of the said Nogales Mining 
 Company were present or represented by proxy, said 
 meeting being the same meeting named ^n the said cross- 
 complaint. At this meeting there were present the plain- 
 tiff W. F. Chenoweth, the aforesaid James A. Cooper, 
 and the defendant v^rant, members of the said Cerro 
 Prieto Mining Company. At that meeting it was 
 agreed unanimously that it was desirable for all 
 parties if certain conditions couid be met, that 
 the said four claims, property of the Cerro Prieto Mining 
 Company, should be conveyed to the saia Nogales Min- 
 ing Company, and it was then agreed by the stockhold- 
 ers of the Nogales Mining Company and by the said W. 
 ^. Chenoweth and the said Grant and Cooper on the part 
 of the Cerro Prieto Mining Company that the Cerru 
 Prieto Mining Company would convey to the Nogales 
 Mining Company the beforementioned four claims, 
 providM: ' ' « . . , 
 
 ' IsL That the amount of the capital stock of the said 
 
64 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 Nogales Mining Company should be increased to fifty 
 thousand shares of the par value of ten dollars each. 
 
 2nd. That there should be issued to the said Cerra 
 Prieto Mining Company twenty-one thousand shares of 
 fiaia stock, 
 
 3rd. That seven thousand five hundred shares of the 
 said stock should be sold at not less than par and the 
 proceeds of such sale should be used as assets of the 
 Nogales Mining Company. 
 
 4th. That the Nogales Mining Company should with- 
 in ten days pay off certain pressing local obligations and 
 should furnish sufficient money to pay the expenses of 
 the transfer of the said property from the said Cerro 
 Prieto Mining Company to the said Nogales Mining Com- 
 pany, the amount named to be lurnished wifEin ten days 
 being nine thousand dollars, and should immediately 
 thereafter from the sale of the said stock pay all of the 
 obligations of the said company, and certain of the stock- 
 holders of the Nogales Mining (company then present 
 gave assurance that within a short time they could place 
 said amount of stock at par, whereby all of the obliga. 
 tions of the said company could be paid. 
 
 Immediately following this aforesaid meeting, said 
 plaintiff W. F. Chenoweth and the said Jas A. Cooper 
 went to Hermosillo, Sonora, and arranged with the 
 Iskwyex of th? said Cerro Pi^ieto Mining Company to pre- 
 pare the necessary conveyances to convey the aforesaid 
 property fropi the said Cerro Prieto Mining Company to 
 the said Nogales Mining Company. 
 
 Plaintiffs further show that at the rnei^tixi^ ot the 
 Stockholders of the Nogales Mining Company aforesaid, 
 the defendant R. E. Doan offered on behalf of the said 
 Mrs. Stuart to give to the said Nogales Mining Company 
 
vs. NOGALES MINING COMPANY ET AL. 65 
 
 Eix thousand dollars If the said Nogales Mining Com- 
 pany would execute to her its promissory note for eight 
 thousand five hundreu dollars, to be dated January 12th, 
 A. D. 1901, payable in six months after date with inter- 
 est at the rate of twelve per cent per annum from date, 
 and would give to him, the said R. B. Doan, five hundred 
 shares of the stock of the said company. Said six thous- 
 and dollars was accepted ana was all applied in part 
 payment of the immediate pressing local debts of the 
 company. 
 
 No money was ever furnished or offered to the plain- 
 tiffs or to anyone representing the Cerro Prieto Mining 
 Company to pay for tne perfecting of the conveyance of 
 the beforementioned property to the said Nogales Mining 
 Company, and no stock of the said Nogales Mining Com- 
 pany was sold, and for that reason the said conveyance 
 was not made, though these plaintiffs were ready and 
 willing at all times up to the said 12th day of April, A. D. 
 1901, at which time was entered into the contract set 
 forth in plaintiffs' complaint as "exhibit A" and *B," to 
 co-operate with the other stocKuolders of the said Cerro 
 Prieto Mining Company to cause the completed trans- 
 fer of the said property to the Nogales Mining Com- 
 pany, whenever the said Nogales Mining Company 
 should furnish money to pay the expenses thereof, and so 
 far as these plaintiffs are concerned they have been 
 ready and willing at any time and are ready and willing 
 to co-operate with the other stockholders of the said 
 Cerro Prieto Mining Company to transfer the said prop- 
 erty to the said Nogales Mining Company upon the ful- 
 fillment of all of the terms of the agroi^uioiLt ot January 
 12th, A. D. 1901, that is to say, upon the payment by the 
 
66 PAPERS IN THE CASE OF CHENOWETH ET AI. 
 
 said Nogales Mining Company of all of its obligations, 
 and of the expenses of the said transfer. 
 
 Plaintiffs allege upon information and belief that the 
 defendant Jesse R. Grant is no longer a fttockholdor ot 
 the Cerro Prieto Mining Company, but show the fact to 
 be that all of his interest in the said Cerro Prieto Min- 
 ing Company has been sold and transferred to one J. 
 Guillermo Dominguez. 
 
 Plaintiffs further show that as to the alleged contract 
 of the 10th day of December, A. D. 1901, set forth in 
 the said cross-complaint and in the "exhibit A" at:ached 
 thereto, plaintiffs know nothing and can answer nothing. 
 
 Plaintiffs further deny that the plaintiff W. 1^. Cheno- 
 weth is a large debtor to the said Nogales Minin.^- Com- 
 pany, or a debtor to it in any sum whatsoever, b-it assert 
 the fact to be that on the contrary the said Nogale? Min- 
 ing Company is in debt to the plaintiff W. F. Chenoweth 
 in the sum of approximately four thousand dollars. 
 
 Plaintiffs admit that in the accounts submitted to tlic 
 defendant company are items of expenditures made for 
 the plaintiffs' own interest and in paying for the survey 
 of the said Grant mining claim, and state the fact to be 
 as to those items that they were accepted by the said com- 
 pany as offsets to obligations owed by the said company 
 to the said plaintiffs. Plain u.^3 state that they do not know 
 what specific items are covered by sucn accounts and 
 therefore can neither admit nor deny that the accounts 
 referred to in the said cross-complaint show that the 
 funds oi the defendant company were used in acquiring 
 title to the said Grant mining claim and m organizing 
 the said Cerro Prieto Mining Company and the convey- 
 ing title to the said Cerro Prieto Mining Company, but 
 allege the fact to be chat any and all items of such na- 
 
vs. NOG ALES MINING COMPANY ET AL. 67 
 
 ture were assumed by the said Nogales Mining Company 
 solely as payment of the amount of such items to the 
 said plaintiffs on bi..s due to the said plaintiffs from the 
 defendant company, and that such accounts were passed 
 upon and approved by the proper officers of the said 
 company. 
 
 Plaintiffs deny that the plaintiff W. F. Chenoweth 
 caused a deed to be made for the said Ocampo mining 
 claim to him from one C. Ramirez. Plaintiffs show the 
 truth of the matter to be that the cash that is alleged 
 to have been paid to the said C. Ramirez, was paid, alid 
 the note that is alleged to have been given to him, was 
 given, by the said defendant company to the said C. 
 Ramirez at a time when the defendant Grant was 
 Manager of the said company and not under the manage- 
 ment of the plaintiff W. F. Chenoweth. 
 
 Wherefore, plaintiffs pray that the defendants take 
 nothing by this cross-complaint, and for their costs, and 
 for such judgment or order as to the Court may seem 
 good. 
 
 H. K. Chenoweth and W. F. Chenoweth. 
 -y Frederick S. Nave, their attorney. 
 
 Territory op Arizona, ) 
 County of 8anta Cruz. ) ' 
 
 W. F. Chenoweth being duly sworn on oath states that 
 he has read the foregoing answer and states that the 
 same is true in substance and in fact except as to those 
 matters therein stated upon information and belief, and 
 that as to those matters he believes it to be true. 
 
 Subscribed and sworn to before me this 6th day of 
 January, A. U. 1902. 
 
 (Seal) FREDERICR S. NAVE, 
 
 Notary Public. 
 
PAPERS IN THE CASE OF CHEKOWETH ET AL, 
 
 Minutes of the Nogales 
 Mining Company 
 
 NOGALES, ARIZ., Oct. 17, 1899. 
 Office of Dr. Chenoweth: 
 
 Meeting of the Nogales Mining Company, there being 
 present Jesse R. Grant, Alfred Hampton and H. K. Chen- 
 oweth. 
 
 Meeting called to order at 9 a. m., Jesse R. Grant, pre- 
 siding. 
 
 On motion, H. K. Chenoweth was chosen president, 
 and Jesse R. Grant, secretary. 
 
 Stock of the company was then placed on the market, 
 resulting in the sale of certificate No. 1, to Jesse R. 
 Grant, representing 10 shares, for $100.00; certificate 
 No 2, representing 10 shares, for $100.00, to H. K. Cheno- 
 weth, certificate No. 3, representing 10 shares, to R. A. 
 McPherson, for $100.00, certificate No. 4, representing 
 10 shares, to W. F. Chenoweth, for $100.00. Alfred Hamp- 
 ton not desiring to purchase any stock, sent in his res- 
 ignation as a director and member of the company, 
 which resignation was duly accepted. Jesse R. Gram 
 H. K. Chenoweth, W. F. Chenoweth and R. A. McPher- 
 son were duly elected directors Oxlhe company. 
 
 The secretary, J. R. Grant, and the president, H. K. 
 
vs. NOQALES MINING- COMPANY ET AL. 69 
 
 Chenowetli, who had been duly elected to these offices, 
 were on motion appointed a committe to pureuase the 
 Zaragoza mine, located in th« District of Magdalena. 
 Sonora, Mexico. 
 
 The Board of Directors decided to meet at Doctor 
 Chenoweth's office tomorrow at 4 p. m. 
 
 There being no further business, the meeting adjourn- 
 ed. 
 
 JESSE R. GRANT, Secretary, 
 
 (Seal of the Nogales Mining Co.) 
 
 NOGALES, ARIZ., Oct 18, 1899, 
 
 Meeting of the Board of Directors of the Nogales Min- 
 ing Company held at Doctor Chenoweth's office this 
 18th day of October, 1899, at 4 p. m. 
 
 Meeting called fo order by H. K. Chenoweth, presid- 
 ing. Present: J. R. Grant, R. ik, McPherson and W. P. 
 Chenoweth. 
 
 J. R. Grant and H, K. Chenoweth report having pur- 
 chased the Zaragoza mine. 
 
 On motion, the Secretary was ordered to have all cor- 
 poration papers properly recorded in Magdalena, Mexico. 
 
 On motion, it was ordered that R. A. McPherson be 
 made our authorized agent to act in the Republic of 
 Mexico. 
 
 Doctor Chenoweth's office was selected as our legal of- 
 fice until lurther ordered. 
 
 There being no further business, the meeting adjourn- 
 ed to meet again at ihe call of the Secretary. 
 
 JESSE R. GRANT, Secretary. 
 
 (Seal of the Nogales Mining Co.) 
 
 NOGALES, ARIZ., Jan, 12, 1900. 
 
 Meeting of the Board or Directors oi the Nogales Min- 
 
70 PAP;EKS IN" THE CASE OF CHENQWETH ET AL, 
 
 ing Company held at Doctor Chenoweth's office this 12ih 
 day of January, 1900, at 11 a, m. 
 
 H. K. Chenoweth, president of the company, presid 
 ing. On call of roll, H. K. Chenoweth, president, J. R, 
 Grant, Secretary, W. F. Chenoweth and R. A. McPher- 
 son, present, ..^ey being all the stockholders as well 
 as all of the directors. 
 
 Minutes of previous meeting read and approved. Oft 
 motion it was decided to amend Article (6) Six of th'? 
 articles of incorporation of the company, so as to read: 
 
 "The highest amount of indebtedness or liability to 
 which this corporation is at any time to subject itself 
 Is Eighty Thousand Dollars" instead of the highest 
 amount oi indebtedness being limited to $20,000.00. So or- 
 dered, and the secretary of the company instructed to 
 see that said amended article be so changed, and legally 
 attended to, and to call anoiner meeting of the Board 
 as soon as so completed. 
 
 There being no further business, the meeting adjourn- 
 ed to meet at the call of tne secretary. 
 
 JESSE R. GRANT. Secretary. 
 
 (Seal of the Nogales Mining Co.) 
 
 NOGALES. ARIZ., Jan. 22, 1900. 
 
 Meeting of the Board of Directors of the Nogales Min- 
 ing Company held this 22nd day of January, 1900, at 
 Doctor Chenoweth's office, H. K. Chenoweth, presiding. 
 
 On call of roll a majority of the stock represented, 
 and a majority of the directors present, being H. K. 
 Chenoweth, W. F. Chenoweth and Jesse R. Grant. 
 
 Minutes of previous meeting read and approved. 
 
 The secretary, J. R. Grant, reports having complied 
 with the instructions of the Board of last meting, order- 
 
vs. NOGALES MINING COMPANY" ET AL. 71 
 
 Jng him to proceed to legalize the amendment of the 
 fcy-laws, stating that they have been duly recorded and 
 ordered printed according to law. 
 
 On motion it was duly ordered that tlie secretary, J. 
 R. Grant, and the president, be and are hereoy appoint 
 •ed a committee to procure the necessary amount of 
 money to erect mills and reduction works, etc., and to 
 work th^ mine, and that they be and are hereby empow- 
 ered to mortgage the company's property to secure said 
 loan, and they are instructed to secure the best possible 
 terms, etc 
 
 There bein^ no further business, the meeting adjourn* 
 «d to meet again at the call of the secretary, 
 
 JESSE R. GRANT, Secretary, 
 
 (Seal of the Nogales Mining Co.) 
 
 NOGALES, ARIZ., March 9, 1900. 
 
 Meeting of the Board of Directors of the Nogales Min- 
 ing Company held in Doctor Chenoweth's office this 9th 
 day of March, 1900, at 10 a. m. 
 
 On call of roll a majority of the stock and directors 
 being present in the persons of W. F. Chenoweth, J. R. 
 Grant and H. K, Chenoweth. Minutes of previous meet- 
 ing read and approved. 
 
 The president, H. K. Cnenoweth, and J. R. Grant, sec- 
 retary, report having made the following contract, which 
 is unanimously ratified, to-wit: 
 
 "By virtue of the powers invested In us as president 
 and secretary of the Nogales Mining Company, and by 
 virtue of the authority given us at a meeting of the 
 Board of Directors of said company January 22, 1900, we 
 hereby assign over to Henrietta Stuart, all of the title, 
 papers and stock of said company, together with the ma- 
 
ri PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 chinery and improvements that are now, or that may be 
 erected thereon, to be held in escrow by the said Henriet- 
 ta Stuart, to secure a loan of fifty thousand dollarr,, 
 made by ner to said company, for the purchase of i .e nec- 
 essary machinery and erecting the same, and for mills 
 ' and reduction works, etc., for the working of said mines. 
 This loan for the purposes aforesaid is to draw ten per 
 cent interest from this date, and to be paid January 1, 
 1901, with its accumulated interest, with a commission 
 on the money so. loaned as to make the loan when paid 
 as aforesaid $55,000.00. Upon full payment of said amount 
 all the title, papers and documents so held in escrow, 
 are to be returned to said company. Signed this 9th day 
 of March, 1900, duly signed by the president and secreta- 
 ry. 
 
 They then proceeded to issue stock to the following 
 persons: J. R. Grant, (1390) one thousano three hundred 
 and ninety shares; to order of H. K. Chenoweth two 
 certificates of 800 shares each ; one other . certificate to 
 H. K. Chenoweth, for one thousand three hundred and 
 ninety shares; to R. A. McPherson, one thousand three 
 hundred and ninety shares; to W. F. Chenoweth, one 
 thousand three hundred and ninety shares; to R. E, 
 Doan and J. A. Cooper, certificate No. 9 for eight hun- 
 dred shares. 
 
 On motion it was ordered that J. A. Cooper be made 
 treasurer of the company. Mr, Cooper is a resident of 
 Washington, D. C, but being present reports receiving 
 into his hands for the company's credit thirty-nine 
 thousand (|39,000.00) dollars. 
 
 H. K. Chenoweth, President. 
 
 J. R. Grant, Secretary. 
 
 J. A. Cooper, Treasurer. 
 W. F. Chenoweth, Director. 
 
vs. NOGALES MINING COMPANY ET AL. 73 
 
 (Seal of the Nogales Mining Co.) 
 
 I concur: R. A. McPherson, March 10th, 1900. 
 
 NOGALES. ARIZ., March 9, 1901. 
 
 Meeting of the Nogales Mining Company's directors 
 and stockholders held .n i^octor Chenoweth's office 
 this 9th day of March, 1900, at 5 p. m. 
 
 On call of roll there were present a majority of the 
 directors and stockholders in the persons hereinafter 
 mentioned, namely: u. A. Cooper, J. A. Grant, H. K. 
 Chenoweth, presiaing, and W. F. Chenoweth. 
 
 Minutes of previous meeting read and approved. 
 
 Now comes W. F. Chenoweth who submits a bid to 
 furnish the Nogales Miniig Ooirpany with a 20- stamp 
 mill full and complete on the ground and in running 
 order and first-class in every particular for the sum of 
 thirty-five thousand ($35,000.00) dollars. This includes 
 a pumping plant and pipe line from the Santo Domingo 
 River to mine, sufficient to supply amply water for said 
 mill and mine, and all appliaricos and fixtures for run- 
 ning a first-class 20-stamp mill, to be completed within a 
 reasonable time. 
 
 The said above contract was duly accepted, and the 
 treasurer was instructed to hold the stock of said W. 
 F. Chenoweth as security for the faithful carrying out 
 of said contract, and warrant for that amount was or- 
 dered drawn on the Treasurer in his favor. 
 
 H. K. Chenoweth, President. 
 J. R. Grant, Secretary. 
 J. A. Cooper, Treasurer. 
 (Seal of the Nogales Mining Co.) 
 I concur: R. A. McPherson, March 10, 1900. 
 
74 PAPERS IN THE CASE OF CHENOWETH ET AL 
 
 NOGALES, ARIZ., July 2, 1900. 
 At residence of H. K. Chenoweth: 
 
 Regular annual meeting of the stockholders of the 
 Nogales Mining Company held in the company's office 
 (which is at present the residence of H. K. Chenoweth) 
 this first Monday in July, 1900, at 3 p. m. Meeting call- 
 ed to order and adjourned by the President H. K. Chen- 
 oweth, until Monday, July 9, 1900. 
 
 ELISA E. de CHENOWETH, Secretary pro. tern. 
 NOGAL.i:uS, ARIZ., July 9, 1900. 
 
 Adjourned regular meeting of the Nogales Mining 
 Company held in the company's office. Called to order 
 by the President, H. K. Chenoweth, at 9 a. m. and ad- 
 journed by request of J. R. Grant, to Saturday, July 14, 
 1900, at 10 a. m. 
 
 "* W. F. CHENOWETH, Secretary pro. tem. 
 NOGALES, ARIZ., July 14, 1900. 
 
 At company's office -i^e regular meeting having been 
 adjourned twice to this date, was called to order at 
 10 a. m. 
 
 On roll call it was found .hat a majority of the stock 
 represented. Minutes of previous meeting read and ap- 
 proved. 
 
 Election of officers for ensuing year declared in or- 
 der. The following were duly elected officers for the en- 
 suing term, and immediately held a joint m'eeting with 
 the stockholders: H. K. Chenoweth, presideLt; Jesse 
 R. Grant, secretary; W. P. Chenoweth, manager; Elisa 
 E. de Chenoweth, treasurer. (Said treasurer to com- 
 mence her official position as soon as the Board of Di- 
 rectors secure a report of the present treasurer and ap- 
 
vs. NOG ALES MINING COMPANY ET AL. 75 
 
 prove her bonds and J. A. Cooper, direcLov, to serve 
 until next regular meeting of the stockholders. 
 
 The following bill for $7841.15 was presented by W. 
 F. Chenoweth, acting manager, was duly allowed and 
 ordered placed on the minutes " and a warrant for the 
 amount ordered drawn on J, A. Cooper, treasurer, for 
 the amount. 
 
 Jesse R. Grant and H. K. Chenoweth, President and 
 Secretary, were duly authorized to procure the necessary 
 funds for the successful completion of the mill and plant 
 now under erection, and are authorized to mortgage the 
 company's property in such manner as may seem ad- 
 visable to them, they using their best efforts in behalf 
 of the company. Increase stocK if necessary. 
 
 Nogales Mining Company, 
 To W. F. Chenoweth, Acting Manager, Dr. 
 
 To money advanced as per following account 
 to June 1st, 1900 $7841.15 
 
 March 4, 1900. Paid to J. R. Grant for money 
 he advanced the company 13000.00 
 
 Maj-ch 9, 1900. Paid W. F. Chenoweth on con- 
 tract for erecting plant 35000.00 
 
 June 1, 1900. Paid W. F. Chenoweth money ad- 
 vanced per bill manager account as per book 
 account 1691.15 
 
 $49691.15 
 
 March 1, 1900. Received from J. A. Cooper, trea- 
 surer $ 5000.00 
 
 March 10, 1900. Received from J. A. Cooper, 
 treasurer 15000.00 
 
76 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 April 1, 1900. Received from J. A. Cooper, 
 
 treasurer 21450.00 
 
 April 30, 1900. Received from H. K. Chenoweth 400.00 
 
 June 1, 1900. Balance due 7841,lo 
 
 $ 49691.15 
 H. K. Chenoweth, PresiJeni;. 
 J. R. Grant, Secretary. 
 W. F. Chenoweth, Manager. 
 (Seal of the Nogales Mining Company.) 
 
 I am fully in accord with the above and concur in the 
 increase of the capital stock to $105,000.00. 
 
 A. D. Sherwsbury. 
 In favor of increasing me capital stock to $105,000.00. 
 . Jas. tA. Cooper. 
 
 NOGALES, ARIZ., June 15, 1900. 
 H. K. Chenoweth, Nogales, Arizona. 
 
 Dear Sir: This will authorize you to vote my stock by 
 proxy at any stockholders' meeting of which I may be 
 absent, or vote my proxy as Director. 
 
 W. F. Chenoweth. 
 (1 10c I. R. Stamp.) 
 
 SAN FRANCISCO, June 15, 1900. 
 To H. K. Chenoweth, Nogales, Arizona. 
 
 This will authorize you to act by proxy for me at the 
 coming regular stockholders' meeting, and to vote my 
 stock at said regular meeting as you would your own. 
 
 Very truly, 
 
 JESSE R. GRANT. 
 (1 10c. I. R. Stamp.) 
 
vs. NOGAT.es mining company ET A1-. 77 
 
 NOGALES, ARIZ., June 15tli, 1800. 
 
 Elisa E, de Chenowetli, 
 
 Nogales, Arizona, 
 Dear Madam: This will be your aufhority for acting 
 :for me, by proxy, at any stockholders' meeting at which 
 I may be absent 
 
 Very respectfully, 
 
 H. K. CHENOWETH. 
 (1 10c. L R. stamp.) 
 
 NOGALES, ARIZ., Sept. 5. 1900. 
 Mr. W, F. Chenoweth, 
 
 Manager Nogales Mining Ca, 
 Nogales,Arizona. 
 Dear Sir: This will authorize you to vote our stock as 
 you would your own, and to act in our stead at any direc- 
 tors meeting, during our absence from Nogales. 
 H- K. CHENOWETH, 
 ELISA E. de CHENOWETH. 
 ( 1 10c I. R. stamp.) 
 
 W. F. Chenoweth, Esq., 
 
 Nogales, Arizona. 
 Dear Sir: This authorizes you to act, by proxy, at 
 first special meeting that may be held by the stock* 
 holders of the Nogales Mining Company, for me, and to 
 vote said proxy on routine ousiness only, namely: 
 Reading and approving of previous meetings, and ad- 
 journing said special meeting. 
 
 Very respectfully, 
 
 JESSE R GRANT. 
 <1 10c. I. R. stamp.) 
 
1'tS- PATITRS'IN THE CASE OF CETENOWETH ET AT .- 
 
 NOGALES, A^txZ., August 25, 1900; 
 To the Board of Directors of tne Nogales Mining Com- 
 pany, Nogales, Arizona. 
 Gentlemen: 
 
 At their laist regular meeting of the stockholders of 
 our company, J. xi. Grant an^ myself were authorized 
 and instructed to procure sufficient money to put our 
 plant aBfd haine ©n a paying basis by the means we 
 thought more convenient and advantageous at the earl- 
 iest possible moment. Said Grant Deing otherwise much 
 occupied, he delegated me to attend to the matter. I 
 had in the meantime sent my brother to Washington 
 on this sa,me mission (money raising), but he returned 
 unsuccessful and have since exerted myself endeavoring 
 to raise the money without resorting to an increase of 
 the capital stock, there being no other plan left, having 
 tried to borrow the amount on second mortgage, on 
 loans on my own stock and interest in other mines, etc. 
 Hence I suggest an increase in the capital stock to avoid 
 further delay and perhaps an attachment on the property 
 for monies due. I suggest it be by you increased to 
 $10,500 shares and the 2600 increase be sold to stock- 
 holders for one half par value. 
 
 A. D. Shrewsburry for himself, and in representation 
 of S. L. Patterson, D. J. Kyan and R. E. Doan, whom 
 I was depending on to raise the necessary funds, recom- 
 mends this pian, and will take liOO shares, and I will 
 take the balance, 
 
 I would urge the importance of haste in this matter. 
 Relying on your seeing the necessity of adopting this 
 plan and knowing you will not treat me unfairly, I 
 have this day hypothecated 1100 shares of my own stock 
 for $5500.00, pledging you to issue to him that number 
 
vs. NOGALES MINING COMPANY ET AI.. 79 
 
 H3f shares of the new issue, and immediately placed the 
 money at the disposal oi the company, and within one 
 hour thereaiter it was paid to Hoy & Titcomb, releas- 
 ing machinery they held, for that amount, in Magdale- 
 -na, Mexico, which was delaying the erection of the mill. 
 
 I liave done the best I could posibly do, and Tiope you 
 will adopt my plan. 
 
 Very truly yours, 
 
 H. K CHENOWETH. 
 
 I concur: A, D, Shrewsburry-. 
 
 KOGALES, ARIZ., August 25, 1900. 
 
 Meeting of tlie Board of Directors of the Nogales 
 Mining Company called for . e purpose of raising funds 
 t<^ pay off some pressing bills, at the residence of H. K. 
 Chenoweth at 1 p. m. 
 
 H. K. Chenoweth, presiding. A majority of c.ie direc- 
 tors being present. 
 
 Minutes of previous meeting read and approved. 
 
 W. F, Chenoweth was duly elected acting secretary^ 
 to carry out any instructions of the meeting and to act 
 in the absence of the regulariy eiecv^^ secretary. 
 
 H. K. Cnenowecu presents attacxxed report, and on mo- 
 tion it was duly accepted, ordered placed on file, and 
 the suggestions therein contained carried out, and that 
 the capital stock be increased 2500 shares, making in 
 all 10,500, ana that the same be legally carried out by 
 H. K. and vvT. F. Chenoweth, and as soon as properly 
 recorded, that they issue to A, D, Shrewsburry and 
 H. K. Chenoweth, the former 1100 shares, and the lat- 
 ter the oalance, 1400 shares, as soon as they exhibit the 
 treasury receipt for $5500,00 and $7000.00 respectively. 
 
80 PAPJEKS IK THE CASE OP CHENOWETH ET AL, 
 
 The contractor and manager, W. F. Chenoweth, re- 
 ports that the plant will probably be in operation in Sa* 
 days from date. 
 
 There being no further business the meeting adjourned 
 to the call of the president, 
 
 W. F, CHENOWETH, 
 Acting Secretary oy order of Board. 
 I concur: Jas, A, Cooper, A. D, Shrewsburry. 
 
 NOGALES, ARIZ., October 25, 1900, 
 
 Meeting of the Board of Directors of the Npgales Min- 
 ing Company held c-^s 25th .ay of October, 1900, at 5 p.m. 
 
 On can of roll a majority of tne uirectors were present. 
 J. A, Cooper, presiding. 
 
 Minutes of previous meeting were read and approved. 
 
 Bill of W, F, Chenoweth for ^i>66.Z2 presented and al- 
 lowed, and ordered spread on the minutes, and warrant 
 for the amount ordered drawn on the treasurer in his 
 favor. 
 
 There being no further business, the meeting ad- 
 journed. 
 
 W. F. CHENOWETH, 
 
 Secretary pro. tern, by order of the Board. 
 
 NOGALES, ARIZ., Oct. 25, 1900. 
 $836.32 U. S. Cy. 
 
 Nogales Mining Company, 
 
 To W. F. Chenoweth, Dr. 
 As per following account: 
 
 Balance aue June 1, 1900 $ 784L15 
 
 Paid on mining account as per book 
 
vs. NOGALES MINING COMPANY ET AL. 81 
 
 • account and vouchers presented for 
 
 March 1 to October 1st 8027.47 
 
 $15868.62 
 
 U. S. Current money $ 836.32 
 
 Sale of stock to A. D. Shrewsburry 5500.0\; 
 
 Paid by warrant June 1st, money account 1692.15 
 
 Sale of stock to D. J. Ryan 625.00 
 
 Sale of stock to Sam. L. Patterson 625.00 
 
 Sale of stock to R. E. Doan 500.0u 
 
 Sale of stock to H. K. Chenoweth 5250.00 
 
 Draft on James A. Cooper 841.15 
 
 $15868.62 
 We owe at this date bills to: 
 M. Latz & Bro., for August and September. 
 Roy & Titcomb, about $1000.00. 
 A. Ullman, one-half of his salary for September. 
 , J. Burns, salary for August and September. 
 J. Leonard, part of his salary for September. 
 
 F. Mendez, for wood. 
 
 For survey on Grant mine. 
 
 G. Heinecke, for September bill. 
 Ed. Noon, for September bill. 
 
 H. E. Stevens, salary for July, August and Septembej. 
 J. J. Chatham, salary for September. 
 
 W. F. CHENOWETH, Manager. 
 We have audited and found it correct: Jas. A. Coop- 
 er, A. D. Shrewsburry. 
 
 NOGALES, ARIZ., Jan. 12. 1901. 
 Meeting of the Board of Directors of the Nogales Min- 
 ing Company held in the Montezuma Hotel at 8 p. m. 
 
82 PAPERS IN THE CASE OF CHENOWETH ET AL 
 
 Minirtes of previous meeting read and approved. , 
 
 On call of roll a majority of the directors were present. 
 Major James A. Cooper, presiding. 
 
 Resignation of Jas. A. Cooper, received, accepted ana 
 R. E. Doan nominated and duly elected in his stead. 
 
 There being no. further business the meeting closed. 
 JESSE R. CjxiANT, Seretary. 
 
 NOGALES, ARIZ., Jan. 12, 1901. 
 
 At a meeting of the stockholders of the Nogales Min- 
 ing Company held at Nogales, Arizona, on this l-ih 
 day of January, A. D. 1901; present all of the stockhold- 
 ers of the shares of stock of said company. On motion, 
 duly seconded and put, it was resolved by a unanimous 
 vote of said stockholders as follows, viz: 
 
 Resolved, that Article 5th of the Articles of Incorpora- 
 tion of this company, be amended to read as follows, 
 to-wit: 
 
 "Article Fifth: The amount of the capital stock oi 
 this company shall be Five Hundred Thousand 
 ($500,000.00) dollars, divided into fifty thousand shares, 
 of the par value of Ten ($10.0v;j dollars each, to be paid 
 for at time of issuing the certificate for the same." 
 
 It was in like manner resolved that the president and 
 secretary be and they are hereby authorized and directed 
 to issue of said stock so increased by sajd amendment 
 of Article B if th. 
 
 First, to the C^rro Prieto Mining Company of the 
 Republic of Mexico, twenty-one thousand (21,000) shares. 
 
 Second, to the present stockholders of the stock of the 
 iNOgales Mining Company, in proportion to their present 
 respective holdings, ten thousand five hundred (10,500) 
 shares. 
 
vs. NOGALES MINING COMPANY ET AL. 83 
 
 And that the remaining eight thousand (8000) shares 
 of said stock remaining in the treasury, to be sold at 
 not less than par and that the proceeds of such sale to 
 be used as assets of - --o company. 
 
 It was in like manner resolved that of the said 8000 
 shares of treasury stock held as assets, five hundred 
 shares be issued by the president and secretary to 
 R. E. Doan, in payment of professional services rendered 
 to this company. 
 
 It was in like manner resolved that the general mana- 
 ger and secretary, be and they are hereby authorized 
 and directed to issue and deliver to Henrietta Stuart, of 
 Washington, D. C, payable to her or her order, the prom- 
 issory note of this company for the sum of eight thous- 
 and five hundred ($8,500.00) dollars, to be dated Jan. 
 12, 1901, payable six months after date with 12 per cent 
 interest from date. 
 
 The report of the Board of Directors made, read, 
 approved and ordered filed. 
 
 Bill of W. F. Chenoweth presented and approved as 
 audited, $2,823.77, and ordered filed. 
 
 Report of James A. Cooper presented, read and ap- 
 proved, au -ited and ordered fileu, showing there to be 
 due to him the sum of $196.17. 
 
 JESSE R. GRANT. 
 
 A. D. SHREWSBURRY. 
 
 DANIEL J. KxAN. 
 
 SAMU£.i^ L. PAl TERSON. 
 
 JAMES A. COOPER. 
 
 R. E. DOAN. 
 
 W. F. CHENOWETH. 
 
84 PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 ELISA E. de CHENOWETH, by W. F. Chenoweth, 
 proxy. 
 
 H. K. CHENOWETH, by W. F. Chenoweth, proxy. 
 
 You are hereby notified that the condition of affairs 
 of the Nogales Mining Company, of which you are a 
 stockholder, are such as to render a special meeting 
 of its stockholders necessary, and that such meeting will 
 be held at the office of said company in the town of No- 
 gales, Arizona Territory, the place designated in the 
 articles of incorporation for the transaction of Its bu- 
 siness; on the 6th day of April, A. D. 1901, at 10 o'clock 
 a. m., the subject of which meeting is the election of a 
 new Board of Directors and the transacting of other such 
 business as the affairs of the company may require. 
 
 I hereby certify that, the president and vice-president 
 of the company being absent from the territory, I give 
 this notice as secretary at the request of the stockhold- 
 ers owning a majority of - -e stock of said company. 
 
 JESSE R. GRANT. 
 
 In response to the above notice, a meeting of the No- 
 gales Mining Company was held at the office of the 
 company, and owing to the fact that a majority of the 
 stock of the company was not represented, the meeting 
 was adjourned to meet at 10 o clock a. m. of April 10, 
 
 1901. 
 
 JESSE R. GRANT, Secretary. 
 
 The adjourned meeting of the stockholders of the No- 
 gales Mining Company was held at the oflEice of the com- 
 
TS. NOGALES MINING COSfPAKY ET Al.. 85 
 
 pany in Nogales, Arizona, this 10th day of April, 1901, 
 at 10 o' clock a, m. 
 
 Meeting called to order by the secretary, Jesse R. 
 KJrant 
 
 It was agreed that as the ofrice of the company has not 
 ^iDeen used for some time, and most of tne furniture mov- 
 ^ed away, the office of .he company should he moved to 
 Dr. i^'erguson's office, where the meeting was held. 
 
 There were present at the meeting: 
 
 Jesse R. Grant, owning 1398 snares, 
 
 James A, Cooper, owning 1630 shares. 
 
 James A. Cooper, by proxy of R. E. Doan, 120 shares. 
 
 R. A- McPherson, owning 10 shares. 
 
 Ray i^erguson, owning 1 shara 
 
 Ohas, -. -..icnards, owning 1 share. Total 4160 shares. 
 
 The attorney for W, F. Chenoweth presented a certi- 
 ficate for 10 sliares standing tn the name of W. F. Chen- 
 oweth, but as he had no proxy from the owner, he was 
 not permitted to vote, but remained through the meeting. 
 
 As 4160 shares is more than a majority of the legally 
 issued stock of the company, the meeting was called to 
 order by Jesse R. Grant. 
 
 On motion duly seconded, Ray Ferguson was elected 
 president of the meeting, and Chas. O. Richards, secre- 
 tary. 
 
 Mr. Grant stated that the object of the meeting was to 
 elect a Board of Directors to take the place of those 
 ■elected at the annual meeting held July, 2, 1900. as the 
 board elected at the annual meeting were not managing 
 the business of the company in a proper manner, 
 
 Mr. Grant placed in nomination James A. Cooper, H. 
 K. Chenoweth, R. A. McPherson, Ray Ferguson and 
 
^ PAPERS IN THE CASE OF CSENOWETS ET AL. 
 
 Chas. O. Richards, to act as directors until the next an^ 
 nual meeting. 
 
 Ray Ferguson seconded the nominations. No other 
 nominations were made. 
 
 All stock present, namely, 4160 shares, was voted 
 for those above named, and they were creclared elected. 
 
 On motion of Mr. Qrant, the Board of Directors were 
 instructed td appoint a new manager to take charge of 
 the mine and milL 
 
 A committee consisting of Ray Ferguson and C. O. 
 Richards was appointed to draft by-iaws and investi- 
 gate all the affairs of the company, and make their re- 
 port at the annual meeting of the company. 
 
 G. O. RICHARDS, Secretary. 
 
 NOGALES, ARIZ,, April 10, 1901. 
 
 At a meeting of the Board of iJirectors of the Nogales' 
 Mining Company held in the office of the company in 
 Nogales, Santa Cruz County, .-rizona, on the 10th day of 
 April, 1901, «it 10:45 a. m,, the following business was 
 transacted. 
 
 By consent of the members present Ray Ferguson 
 tvas made temporary chairman and Chas, O. Richards, 
 temporary secretary, for the purpose of organizing. 
 
 On call of roll the members found to be present were; 
 Jas. A. Cooper, R. A. McPherson, C. O, Richards and 
 Ray Ferguson. 
 
 On motion of C. O, Richaras, seconded by R, A. Mc- 
 Pherson, Mr. Jas. A. Cooper was elected president of the 
 board. The members voting aye being: R. A.McPherson, 
 C. O. Richards, Ray Ferguson and James A. Cooper. 
 
 On motion of C. O. Richards, seconded by R. A. Mc- 
 Pherson, Mr. H. K. Chenowech was elected vice-presi- 
 
vs. NOG ALES MINING COMPANY ET AL. 87 
 
 dent. The members voting aye being: R.. A. McPherson, 
 'C. O. Richards, Jas. A. Cooper and Ray Ferguson. 
 
 On motion of o. O. Ricliarus, seconded by Jas. A. Coop- 
 ■er, Ray Ferguson was elected secretary and treasurer. 
 The members voting aye being: R. A. McPherson, C. O. 
 Richards, James A. Cooper and Ray Ferguson. The 
 board being now organized and the officers installed, 
 business was transacted as follows: 
 
 In response to instructions received from a majority 
 'o'' the stockholders of the Nogales Mining Company in 
 meeting assembled on April 10th, 1901, at 10 o'clock a. 
 m., a copy of the proceedings being on file in said office, 
 action was taken towards the election of a manager of 
 the company. 
 
 On motion of R. A. McPherson, seconded by Ray Fer- 
 guson, Mr. C. O. Richards was elected manager for the 
 Nogales Mining Company for Mexico and the United 
 States. The members voting aye being: Jas. A. Cooper, 
 R. A. McPherson and Ray Ferguson. 
 
 On motion of R. A, McPherson, seconded by Ray Fer- 
 guson, the manager was and is authorized anl empow- 
 ered to take such action as he may aeem necessary to 
 gain possession of all property of the company in a legal 
 iind business like manner, and that he is further author- 
 ized to take whatever action he deems best in opei^ating 
 the mines, mill, pumping plant and other property of the 
 company. The members voting aye being: Jas. A. Coop- 
 er, R. A. McPherson and Ray i^erguson. 
 
 On motion of C. O, Richards, the secretary was author- 
 ized to purchase a book for recording the minutes of 
 meetings of the board. 
 
 There being no further business, the meeting was ad- 
 journed at the call of the president 
 
 RAY FERGUSON, Secretary. 
 
8S PAPERS lx\ THE CASE OP CHENOWETH ET AL. 
 
 NOGALES, ARIZ., April 15, 1901. 
 
 Meeting of the Board of Directors of the Nogales Min- 
 ing Company held at the office of the company on ^prir 
 15th, 1901. 
 
 Present: Jesse R. Grant, C, O. Richards, James A.. 
 Cooper, Ray Ferguson. Minutes of previous meeting^ 
 read and approved. 
 
 Resignation of H. K. Chenoweth as a member of the 
 Board of Directors and as vice-president of the board, 
 read and accepted. 
 
 Motion of C. 0. Richards, seconded by Ray Ferguson, 
 Jesse R. Grant was elected member of the Board of Di- 
 rectors to fill the vacancy caused by the resignation of 
 H. K, Chenoweth, 
 
 C. O. Richards, manager, reports the mine and mill in 
 the possession of the company an- this board, and states- 
 tliat the ^iiU ]ias been shut down for repairs, and that 
 it will probably be ninety days before it can be put in 
 goo4 working order. He states tnat the development 
 of the mine is being pushed ahead, working tunnel 
 being driven inward, connections between tunnel No. 
 1 and No. 2, and between No. 2 and No. 3, being made 
 to facilitate uandling of ore. 
 
 Mr. Richards was instructed to employ an attorney 
 to assist him in legal questions at a salary of $100.00 
 Mexican silver per month. 
 
 Statement of aebts owing by the company was receiv- 
 ed from Dr. Chenoweth and ordered filed. 
 
 On motion of Mr. Grant, seconded by Ray Ferguson, 
 Mr. C. O. Richards was empowered to investigate all of 
 the accounts of labor and supplies furnished as per state- 
 ment of W. F. Chenoweth, and to act as seems best in 
 his judgment in the settlement of the same, and for the 
 
vs. NOGALES MINING COMPANY ET AL. 89 
 
 company to refund all moneys used by said Richards in 
 settlement of claims. 
 
 On motion of Mr. 'J. R. Grant, seconded by Mr. Rich- 
 ards, it was resolved to retain Mr. Pedro Trellas as 
 book-keeper at the mine on a salary of $120.00 gold per 
 month, for the present. 
 
 On motion of J. A. Cooper, seconded by Mr. Grant, 
 it was resolved to empower Mr. C. O. Richards to ar- 
 range for $5000.00 to be expended for supplies in work 
 of developing the mine, repairing mill and pump, the 
 same amount to be repaid with interest from the lirst 
 funds received by the company. Ayes: Cooper, Grant 
 and Ferguson. 
 
 Mr. Riciiards' salary was then fixed at $300.00 per 
 month, until such time as the mill is producing, when 
 he will expect an increase. 
 
 On motion of C. O. Richards, seconded by J. R. Grant, 
 the secretary was instructed cO call upon W. F. Cheno- 
 weth, as manager, and Elisa E. de Ohenoweth,as treas- 
 urer, and upon J. A. Cooper, as former treasurer, for 
 a report of all monies, checks, drafts, bullion, etc., pass- 
 ing through their hands, together with voucher for 
 same. Ayes: Grant, Cooper, Richards, Ferguson. 
 
 Mr. Kichards suggested that ail the stockholaers be in- 
 formed of condition of mine, mill, etc., anc says that at 
 the annual meeting or sooner he will give a detailed 
 report of all property of tne company, and furnish full 
 statement as to condition, etc. 
 
 J. A. Cooper aumorized the secretary to transfer 25 
 shares of stock standing in his name to S. vv^. Briggs. 
 and 2 shares to Aaron TownsSend, both of Washington, 
 D. C. 
 
 On motion of Mr. Grant, seconded by Mr. Richards, 
 
90 PAPERS IN THE CASE OF CHEXOWETPI ET AL, 
 
 R. A. Mcrherson was elected vice-president to succeed 
 H. K. Chenoweth, resigned. 
 
 Contract of J. R. Grant attached. 
 
 KAY FE±tGUSON, Secretary. 
 
 NG^ALES, ARIZ., ^vprll 12, 1901. 
 
 Memorandum of an agreement entered into this 12th 
 day of April, 1901, by and between W. F. Chenoweth 
 and H. K. Chenoweth, parties of the first part, and Jesse 
 R. Grant, party of the seco. part. 
 
 Witnesseth: That in consideration of five thousand 
 dollars U. S. current money, to be paid to the party of 
 the first part by the party of the second part, the said 
 party of the first part agrees to sell, transfer and assign 
 to the said party of the second part all their right, title 
 and interest in all of the stock owned by them in the 
 Nogales Mining Company, a corporation formed under 
 the laws of the territory of Arizona, and having its prin- 
 cipal ofllce in Nogales, Arizona, reserving only such 
 stock as represents 700 snares out of the 50,000, which 
 interest we have previous to this agreement contracted 
 to deliver to other parties. 
 
 Further, it is agreed that this contract shall not con- 
 flict with, but shall oecome a part of a certain contract 
 and agreement entered into on the 11th day of April, 1901, 
 in the City of Hermosillo, for the transfer of 50 shares 
 of stock in the Cerro Prieto Co., a corporation existing 
 under the laws of the State of Sonora, Republic of Hex 
 ico, whereby the full amount the parties of the first part 
 shall receive is Thirty-five Thousand ($35,000.00) dol- 
 
vs. NOG ALES MINING COMPANY ET AL. 91 
 
 lars U. S. gold coin, and this document is a receipt for 
 Five Thousand ($5000.00) dollars. The other Thirty 
 Thousand ($30,000.00) dollars shall oe paid within six 
 months from the date of signing the contract with the 
 Cerro Prieto Mining Co. before mentioned, viz: the 11th 
 day of April, 1901, making this contract or agreement 
 void after October 11th, 1901. 
 
 Further, it is agreed that the party of the second part 
 accepts this contract, relieving the parties of the first 
 part from all responsibility and further agrees to carry 
 out all legal contracts and pay all legal bills. Further 
 the party Oi the first part agrees to see that a certain op- 
 tion given to one R. A. McPherson, by one of the par- 
 ties of the first part on or about Feb. 25th, 1901, and 
 which said first party considers void, but in order to 
 avoid the expense of defending any suit said McPherson 
 might instigate, said second party agrees to have said 
 option duly cancelled and does hereby relieve said first 
 party from all reliability. 
 
 Further, the parties of the first part hereby direct the 
 secretary of the Nogales Mining Company to enter the 
 contents of this contract on the books of the company 
 ind we authorize said secretary to accord to said second 
 party, the full voting power of tae stock owned by the 
 said first parties during the term of this contract, and 
 upon the fulfillment of the same, to cancel said stock as 
 represented in this contract and reissue the same to the 
 said second party. 
 
 Further, the said first parties do hereoy authorize the 
 secretary of the Nogaies Mining Company to enter on 
 the books of the company the resignations as directors 
 and officers of said company the names of W. F. Cheno- 
 
92 PAPERS IN THE CASE OF CHENOWETH ET AL, 
 
 wetn, H. K. Chenoweth and Elisa E. de Cnenoweth, 
 said resignations to date from April 9th, 1901. 
 
 JESSE R. v^RANT. 
 
 W. F. CHENOWETH. 
 
 H. K. CHENOWETH. 
 
 ELISA E. de CHENOWETH. 
 Witness: Jas. A. Cooper. 
 
 TERRITORY OF ARIZONA, 
 COUNTY OF SANTA CRUZ '' 
 
 I, , a notary public, 
 
 in and for tlie County of Santa Cruz, Territory of Ari- 
 zona, duly commissioned and sworn, do hereby certify 
 
 that the foregoing document consisting of 
 
 pages, on the margin of which I have written my name. 
 is a full, true and correct copy of the minutes of the 
 Nogales Mining Company, as contained in the minute 
 books of said company, exhibited to me by the secretary 
 of said company, from the date of the organization of 
 said company to this 22nd day or June, A. D. 1901, and 
 that the foregoing was by me carefully compared with 
 the original entries on said minute books. 
 
 Given under my hand and seal of office, at my office in 
 
 Nogales in said county, this day of 
 
 A. D. 1901. 
 
 Notary Public. 
 My commission expires 
 
vs. NOGALES MINING COMPANY ET AL. 93 
 
 Abstract of Argument for 
 Temporary Receiver. 
 
 Brief summary of argument of Rochester Ford and 
 Frederick S. Nave for the appointment and retention of 
 a receiver to conserve property of the Nogaies Mining 
 Company, pending final judgment. 
 
 The obligations of the company appear from the 
 pleadings to be in excess of eighty thousand dollars, the 
 maximum indebtedness as limitea by the articles of in- 
 corporation of the company. The plaintiffs are person- 
 ally interested in preserving to its highest the security 
 for the obligations of me company, oecause their stock 
 m the company is pledged as security for the payment 
 of the loan ot $50,000 made -y Mrs. Stuart, ana the plain- 
 tiff H. K. Chenoweth is an endorser of the company's 
 note to Mrs. Stuart in that amount. Further, it is alleg- 
 ed in the pleadings that the company is indebted to 
 plaintiff W. F. Chenoweth approximately in the amount 
 of $4000. It appears to be conceded in the pleadings of 
 both parties that the property of the company is of such 
 character that upon forced sale, but little can oe realized 
 from it, a valuation of but $10,000 being placed upon it in 
 the pleadings. Therefore it is conspicuously clear that 
 
^ PAPERS IN THE CASE OF CHENOWETH ET AL. 
 
 :is matters stand at present the company is insolvent. 
 It is an establisned rule o. law that, with limitations,, 
 the directors of an insolvent corporation must handle- 
 its property sLs trustees for the benefit of its creditors. 
 Thomp. Corp. 4132 et seq. Limitations have been placed 
 upon the oroad uoccrine as formerly held, but the fidu- 
 ciary relation cleariy arises on the conceded facts of this 
 case. The defendant C. O. Richards is a director and 
 manager of the company, it is admitted by him under 
 oath that a moTcgage was given to him, encumbering 
 the property of the company, to secure a loan to the 
 company as alleged in the sum of $15,000, The result 
 of this mortgage was to place him in a position of pre- 
 ference as against all other creditoTs, which, at the 
 best, and under the most lenient holdings of courts 
 seems a doubtful act, and probably, with no other aoubt- 
 fiil matters to weaken .s posit-on, an act which credit- 
 ors can successfully oppose. But the making of thi^ 
 mortgage was confessedly followed within a very short 
 time^-Within a tew weei..., -^ will be seen by a compu- 
 tation based on the several facts alleged— by a proceed- 
 ing to foreclose it, xhe result of foreclosure sale woula 
 manifestly be uiat the proceeds would not even pay out» 
 the $15,000 alleged to ^e secured by the mortgage, and 
 would leave otner creditors, whose credits aggregate, 
 apparently, over $70,000, withouc remedy, or possibility 
 of recovery of their money except that Mrs. Stuart would 
 have recourse upon the plaintilf H. K. Chenoweth. 
 Should the mineral resources of . -e property afterwards 
 be found of value, the purchaser under the foreclosure 
 sale could become wealthy, while the persons whose 
 money made possible the aevelopment of the property, 
 erected the mill, pumping plant, etc., lose their entire 
 
TS. NOGALES MINING COMPANY ET Al.. 95 
 
 Investment. Defendants show a further wilful disre- 
 gard of the r.ghts of the plaintiffs by refusing to recog- 
 nize them as stockholders, or to extend them their rights 
 as such stockhOx- ers. Whether tlie acts of Richards are 
 supported by a majority or minority of the stockholder 
 ifi immaterial. A majority of . -e stockholders have no 
 right to unite in ihe destruction of the property of the 
 cojporation, and sale under foreclosure would amount 
 to that. The rignts of lae minority will be protected by 
 courts of equity, as also the rights of creditors, and 
 ppending fina. adjudication of the question of the vali- 
 dity of tne mortgage to Richards, of the validity of the 
 obligation it purports to represent, and of the rights 
 ■of plaintiffs as stockholders and creditors, the court 
 cannot refuse to take the company's property unaer its 
 protection and protect it from the acts of the board of 
 directors. Consol. Tank Line vs. Kas. City Varnish Co. 
 43 Fed. 204; State vs. Dist. Court, 39 Pac. 316; Cameron 
 vs. Groveland Imp. Co. 54 Pac. 1128; State vs. Dist. 
 Court 56 Pac. 219. xne alleged agreement to defer all 
 action on the mortgage for two years cannot alter the 
 obligation of the court to keep custody of the property, 
 pending final judgment The record discloses numerous 
 agreements, the observing of which, or failure to observe 
 which seems to be the fundamental cause of all the 
 difficulties between the parties. The Court should tem- 
 porarily enjoin the foreclosure of Richards' mortgage, 
 pending final judgment; ana should hold in its own im- 
 partial control tne property of the company. Keep- 
 ing any of the parties from affecting the rights of any 
 of the others or from endangering the safety of all the 
 creditors, until such time as tne rights of all shall be 
 finally ascertained by the Court, and each one placed 
 in possession of his rigats.