Question
Daly, a U.S. citizen, began negotiations with Stevens of Vancouver to investigate and stake mineral claims at the head of the Leduc River in British
Daly, a U.S. citizen, began negotiations with Stevens of Vancouver to investigate and stake mineral claims at the head of the Leduc River in British Columbia. Daly had discovered evidence of deposits there some 20 years earlier.
On January 13, Daly wrote, "A large mining company in Boise is showing an interest. To protect my interest it will be necessary for me to arrive at some definite arrangement soon." Stevens replied on January 17, "Perhaps we can make some arrangement this summer to finance you in staking claims for which I would give you an interest. I would suggest that I should pay for your time and expenses and carry you for a 10 percent interest in the claims." Daly replied on January 22, "Your proposition appeals to me as being a fair one."
Soon after, Daly was called to active duty in the United States Naval Reserve Engineering Corps and was sent to the Marshall Islands. Correspondence continued with some difficulty, but on February 28, Daly wrote, "As I informed you in a previous letter, your offer of a 10 percent interest for relocating and finding these properties is acceptable to me, provided there is a definite agreement to this effect in the near future."
On March 5, Stevens wrote, "I hereby agree that if you will take me in to the showings, and I think they warrant staking, I will stake the claims and give you a 10 percent interest. The claims would be recorded in my name and I will have full discretion in dealing with themyou are to get 10 percent of the vendor interest. I can arrange to get a pilot here."44Daly replied on April 12, "If you will inform me when you can obtain a pilot, I will immediately take steps for a temporary release in order to be on hand."
On June 6, Stevens wrote, "I was talking to a prospector who said he had been over your showings at the head of the Leduc River, and in his opinion it would be practically impossible to operate there, as the showings were behind ice fields that, along with the extreme snowfalls, make it very doubtful if an economic operation could be carried on. I now have so much work lined up that I doubt if I would have time to visit your showings and do not think I would be warranted in making the effort to get in there due to the unfavourable conditions. I must advise you, therefore, not to depend on making this trip, and suggest if you are still determined to go in, to make some other arrangements."
Daly did not reply. On his return from the Marshall Islands the following year, he did, however, follow up his interest in the property. He discovered that in July, Stevens had sent prospectors into the area and, as a result of their investigations, had staked claims in his own name and later sold them to a mining development company. Daly brought an action against Stevens claiming damages for breach of contract.
Should Daly succeed in his action? Explain.
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