begin active work on the mines, and Gleeson and Reilly had contributed their proportions of the purchase price of the said claims, Costello should deed to the corporation all the mines owned by the partnership, and that John Gleeson should have the management of the affairs of said corporation, at a salary of $250 per month, and be paid $60 per month for the use of his teams and wagons. The Costello Copper Company, however, transacted no business whatever, and none of the claims was deeded to it, but Martin Costello paid for all assessment work, taxes, and the expenses of making locations and procuring patents.

mining claims in the Turquoise district, in | this that when the partners were ready to which, in the opinion of Gleeson, Reilly, and Costello, the mining industry was then looking up. At that time Costello was the owner of over $200,000 in cash, but was indebted to Reilly in the sum of $90,000, and John Gleeson, on that day, became the owner of four promissory notes, aggregating $53,000, secured by a mortgage on certain mines and mining claims of the Copper Belle Mining Company. Gleeson objected at first to Reilly's proposal to extend the scope of the partnership by the purchase of other claims upon the ground that he had not the means to enter upon such an undertaking, whereupon Costello agreed to advance the money for him, provided he would transfer to Costello the said Copper Belle notes as security for Gleeson's contributions, and provided, fur | ther, that title to all the claims acquired ly, transferred them to Martin Costello for should be taken in the name of Costello, and so held until Gleeson and Reilly should contribute their share of the purchase price of said claims. In pursuance of this arrangement, Gleeson at that time left said notes with Reilly, representing the partnership, "as security for his obligation to contribute his share of the expenses of the partnership."

Litigation arose over the Copper Belle notes not many months after their receipt by Gleeson, who, acting upon the advice of Reil

the purpose of making more sure their collection, in consideration of the sum of $25,000 and other mining property situated near Tombstone. This transfer, while ostensibly evidencing a sale in fact, was, in reality, a wash sale, not bona fide, and made solely for the purpose of enabling Costello to collect the notes; it having been mutually agreed between Costello and Gleeson that when they were collected Costello should turn the proceeds over to Gleeson, the real owner of the notes.

It was further agreed that Gleeson, being a man of experience in the mining industry, should contribute his knowledge and experience in acquiring such claims as they might desire; that Reilly, who was an attorney at In September, 1907, Costello granted to law, should contribute the legal services nec-L. W. Powell, representing the Calumet & essary in the acquisition and disposition of said claims; and that Costello, a man of large means, should advance, without interest, the cash necessary to purchase said claims, subject to reimbursement by Reilly and Gleeson in proportion to their one-third interests. In pursuance of the agreement to extend its scope, the partnership purchased, between 1902 and 1908, a large number of mining claims in the Turquoise district, and took title to same in the name of Costello, who advanced from his personal funds all the money therefor, to wit, about $80,000.

Shortly after the partnership decided to Increase its holdings, the Power option, because of the decrease in value of mining property and the depressed condition of the mining industry generally in the Turquoise district, was by mutual agreement abandoned, and payments stopped thereon, under the belief that a second option could be procured later on at a less price; and thereafter, to wit, on June 6, 1903, an option on the said San Francisco, Fennard, and Batavia mining claims was taken from Patrick Power by the partnership in the name of Costello, which option was thereafter consummated by Costello's paying the purchase price of the said claims.

In August, 1903, Gleeson, Reilly, and Costello formed a corporation, the Costello Cop per Company, for the more convenient handling of the mining claims owned by the partnership. It was agreed shortly before

Arizona Mining Company, an option to purchase certain of the partnership mining claims for the sum of $150,000, to be paid as follows: $15,000 down, $35,000 on or before September 30, 1908, and $100,000 on or before March 30, 1909. Gleeson had promised Powell, shortly before this, while Costello was in Europe, an option covering this identical property, and on the same terms, except that he required no payment down, whereas Costello demanded a 10 per cent. initial payment and refused to sign any option which did not contain such provision, whereupon Gleeson, desirous that the sale be consummated, guaranteed said L. W. Powell, representing the Calumet & Arizona Mining Company, a repayment of the 10 per cent. demanded by Costello in case said

ments other than the initial one of $15,000 option was not completed, and, since no paywere made thereon, the option was surrendered and Gleeson forced to return to said company $6,250, but the agreement to return this initial payment was the individual obligation of Gleeson; the other parties having neither consented to it nor ratified it. Gleeson was very active in the negotiations of the said option for the reason that he and one Douglas Gray were interested in an option on which L. W. Powell, representing the Calumet & Arizona Mining Company, had paid them $15,000, and he believed that if the option on the partnership

money and his interest in the property, he accepted from Costello, without deducting anything for his contribution to the partnership, the money due him on the Copper Belle notes, less the amounts due both Costello and Reilly on account of individual transactions, and an item of $11,549.19 due Mrs. Reilly. Gleeson thereafter executed a deed in favor of Martin Costello conveying the mines deeded by the latter to the former as a part of the consideration for the pretended sale of the notes, and offered to deliver the same to Costello, but he refused it, as did his executrix when the offer was renewed after his death.

The interest of James Reilly in and to the assets of said copartnership were transpay-ferred by him to Costello before the former's death, which occurred June 8, 1909. action was filed September 24, 1909, and Costello died September 15, 1911.

Gleeson's version of the conversation is as stone the last time [late in 1908], going to Califollows:

"Judge Reilly never contributed a cent that nothing in the record of the former trial, nor I know of."

he contributed such interest to the partner-, 4 N. W. 434. 2049 Revised Statutes of Arizship. And we think that such facts are not ona 1913." established by appellee's testimony that Reilly, in a conversation held ten years before, used the first personal pronoun "we," meaning Costello and Reilly, instead of the second personal pronoun "you," meaning Costello alone, in the expression "we got the Mono" and "we would pay the options," and "we would put the Mono and Power claims into the partnership," to which Costello replied, "Yes, all right; that will be all right." Especially is this true in view of appellee's former statement that "Judge Reilly never contributed a cent that I know of," and Costello's testimony that "Judge Reilly had no interest in the Mono whatever, and was never interested in any mining claims with me." Costello's reply, "Yes, all right; that will be all right," even though it be held to be an admission against interest, and given the fullest weight

[2, 3] A consummated partnership which would have the effect of establishing in Costello the trust relation regarding these claims ought to be proven by evidence as clear and satisfactory as would be required to show the trust relation direct, without the intervention of a partnership. If, therefore, the evidence be considered sufficient to substantiate the finding that the partnership agreement was entered into in December, 1901, as alleged, before a consummation thereof can be made to appear, it must be shown that each of the partners contributed his proportion of the agreed assets. The fact that Gleeson and Costello may have paid their proportions would not establish a partnership composed of Gleeson, Reilly, and Costello, with each contributing property valued Reilly, either directly or through Costello, at $20,000, when there is no showing that prosecuted by Reilly's executor to deprive partnership does not, in itself, create a partpaid his. "The mere agreement to form a Costello's estate of its legal title to any partnership; nor does the advancement by any of the mining claims which Costello purchas- one party of his agreed share of the capied with his own funds. In the light of the tal. The entire agreement and all of the atcase of Costello v. Cunningham, 16 Ariz. 447, tending circumstances are to be taken into 147 Pac. 701, such a declaration, standing consideration in determining whether a partalone or taken in connection with the other nership was actually launched." 30 Cyc. evidence in this record, would not warrant the court in finding that Costello held onehalf of the Mono mining claim in trust for Reilly in December, 1901, nor that he held it, together with the San Francisco, Fennard, and Batavia mining claims, in trust for the partnership, after that date. As said by this court in the Costello-Cunningham Case:

possible, would not be sufficient in an action

"These statements by Costello became admissible as evidence only because they were made by him against his interest. Clearly such statements, when given the most favorable effect to the plaintiffs, are simply statements to the effect that Cunningham owned a half interest with Costello in mines in the Warren mining district, and that Cunningham was a partner with Costello in mines situate in that mining district. Such statements and declarations, standing alone, are not sufficient evidence to determine, or sufficient evidence of its nature to warrant the court in finding that Costello and Cunning; ham acquired mines by each paying an equal share of the expenditures laid out in their acquisition, and that Costello took the record title thereto # * in his name in trust for the use and benefit of himself and his co-owner, Patrick Cunningham. Such statements and declarations made by Costello are insufficient, standing alone, to establish the trust contended for. Leatherwood v. Richardson, 11 Ariz. 278, 94 Pac. 1110. * * The rule requiring the evidence to be clear and satisfactory is especially applicable where the trust is attempted to be proved by parol evidence, as well as when it is sought to convert into a trustee a person holding the title to property ostensibly as absolute owner. 39 Cyc. 84, 85. The statements and declarations of a holder of the record title of mines, made against such title, can affect the holder's title only by way of working an estoppel. Oral statements or silence could never have the effect to pass title which the statute expressly declares shall be transferred by deed only. Hayes v. Livingston, 34 Mich. 384, 22

357.

[4] The court has found, as alleged by appellee, that a supplemental partnership, extending the scope of the original one so as to embrace a large number of other claims in the Turquoise district, was entered into by the three partners in February, 1902. This is an important finding, which has been assigned as error and fully argued by both appellant and appellee in their very exhaustive briefs, but we deem a discussion of it unnecessary, in view of the transaction of September, 1908, as it is termed in the record, and the construction which must be placed thereon. Appellant contends that even though the supplemental agreement was entered into and the claims described in the third amended complaint purchased by the partnership in pursuance thereof, a proper construction of the transaction or settlement of September, 1908, will establish the fact that appellee by that act withdrew any contribution he may have made to the partnership in its extended scope, and that the effect of such withdrawal was to dissolve any partnership theretofore existing, thus ending Gleeson's connection with the partnership and leaving Costello the owner of the equitable as well as the legal title of all claims alleged to have been purchased by the partnership. The basis for this position is found in paragraph 16 of appellee's second amended answer, which reads as follows:

"Further answering said third amended complaint, this defendant is informed and believes and therefore alleges that if any partnership or trust relation ever existed between plaintiff and Martin Costello, deceased, in relation to any of

whether as alleged therein or otherwise, which this defendant does not admit, but, on information and belief, denies such partnership, or trust, was fully dissolved and terminated during or about the month of September, 1908, at which time a full and complete accounting and settlement of the affairs of said alleged partnership was had and completed between plaintiff herein and Martin Costello; that at said time plaintiff herein voluntarily withdrew all and any contributions theretofore made by him to or for the benefit of said alleged partnership and received full payment thereof from Martin Costello; that in and by said accounting, settlement, and payment, plaintiff herein renounced and relinquished all and every alleged interest or claim of interest in or to any of the properties mentioned in the third amended complaint, and that his alleged interests therein, or in said alleged partnership thereupon ceased and determined; that plaintiff thereupon voluntarily relinquished all of said properties to the said Costello, who at all times thereafter, at his own expense and risk and without any cost or hazard to plaintiff herein, continued to control and care for said properties in the purchase of which he had expended approximately $100,000 of his personal funds; that having thus freed himself of all risk or hazard of said alleged partnership enterprise, and having withdrawn all of his alleged contributions thereto, and having so continued without risk or hazard of loss, plaintiff now seeks to participate in the fruits of Costello's successful handling of said properties, all of which was attained at the sole risk and by the sole efforts of Costello, and at his sole expense; that when plaintiff so withdrew his alleged contributions to said alleged partnership, said alleged partnership, if any there was, was largely indebted to Costello for moneys expended by him in the purchase of said properties and in perfecting and maintaining the titles thereto, no part of which was then or at any time paid by plaintiff."

was the real party in interest, or that Gleeson ever indorsed or delivered said notes to Costello, and alleged a lack of consideration for the notes. Gleeson, who was made a party defendant on motion of the Copper Belle Mining Company, admitted in his answer the making of a certain agreement which the said company had pleaded also as a defense, and which would probably have been good against him as plaintiff in the case, but denied that Costello had any knowledge of said agreement when the sale was made and the notes delivered. So, whether the sale of these notes by Gleeson to Costello was bona fide or merely simulated-done for the purpose of enabling Costello, as a bona fide purchaser for value without notice, to do for Gleeson what he probably could not do for himself was the pivotal point in the case. Gleeson testified that Costello paid him $25,000 in cash, and conveyed to him certain mining claims near Tombstone as consideration for the notes. Costello's testimony was to the same effect. And the trial court finally decided that Costello was a bona fide purchaser of the notes, and on July 29, 1908, gave him judgment for the amount due on them, to wit, $63,659.32, and ordered foreclosure of the mortgage. This judgment was satisfied of record by Costello on August 28, 1908.

In addition to the foregoing facts concerning the Copper Belle suit, it was further established in this case that on August 8, 1908, following the rendition of the Copper Belle In order that the transaction or settlement judgment, Reilly, who was then and had of 1908 and its relation to this suit may ap- been for many years the legal adviser of pear, a brief statement of the facts of the both Costello and Gleeson in their individcase of Martin Costello v. Copper Belle Min- ual capacities, wrote the latter informing ing Company, a corporation, is necessary. him of the result of the case, and inclosed a In February, 1904, Martin Costello filed suit statement of his account with Costello and in the territorial district court at Tomb- Gleeson for legal services in reference to stone against the Copper Belle Mining Com- mortgages and suits concerning the Copper pany, a corporation, on four certain promis- Belle mining claims. On September 13th, sory notes aggregating $53,000 and executed thereafter, Gleeson called upon Costello and under date of February 4, 1902, by the said Reilly at the latter's office in Tombstone for Copper Belle Mining Company in favor of the purpose of settling up the Copper Belle John Gleeson, each in the principal sum of transaction, and in consequence of the set$13,250, and bearing interest at the rate of tlement reached at this time Costello ac3 per cent. per annum, interest payable an- counted to Gleeson for the full amount of the nually. These notes matured one each year Copper Belle judgment. to wit, $63,659.32, for the years 1906, 1907, 1908, and 1909, re- by giving Gleeson a check for $33.659.32, and spectively, and their payment was secured paying, at the request of the latter, $11,257.by a mortgage on ten mining claims of the 70 to Judge James Reilly, $11,549.19 to Mrs. said Copper Belle Mining Company located James Reilly, and retaining for himself $7,in the Turquoise mining district. It was 423.16 in repayment of a loan he had prefurther alleged that in July, 1902, and be- viously made Gleeson. In the statement infore any of said notes became due, John closed in Reilly's letter to Gleeson there is Gleeson, for a valuable consideration, as- an item of $10,000 for legal services in the signed and delivered them to Martin Cos- Copper Belle and other litigation, which tello, who then became and thereafter re- amount was included in the $11.257.70 paid mained the owner and holder of said notes, Judge Reilly by Costello at Gleeson's retogether with the mortgage securing their quest. It was further shown that within payment. The Copper Belle Mining Com- 14 days from the time Costello paid Gleepany answered by denying, among other son by checks the $25,000 cash consideration things, that Costello was the owner and hold- for the notes, which was on January 12, er of said notes and mortgage, or that he 1903, this entire amount was returned to