[HM87AAW], Letter from Eaton and Lewis to Alfred Ord Tate, June 27th, 1889


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[HM87AAW], Letter from Eaton and Lewis to Alfred Ord Tate, June 27th, 1889

Editor's Notes

[attachment] "Re contract between Edison and the Edison Ore Milling Co., Ltd. Replying to your letter of the 20th inst., addressed to our Mr. Eaton, in which you call our attention to the contracted dated October 14th, 1887, and certain special clauses therein, and request to know whether, under this contract, Mr. Edison has a right to demand payment from the Ore Milling Co. for certain work, we beg to advise you as follows: ## The third clause of the contract in question provides that Mr. Edison 'will make and prosecute with all reasonable speed and diligence, from and after the execution of this agreement, investigations and experiments for discovering, devising and procuring the best and most profitable processes,apparatus, devices and means for extracting metals from ores, tialings, gravel and other deposits, &c. &c.' Later on, in the same clause, the contract provides that 'all costs and charges incurred or to be incurred in the procuring of said Letters Patent or in the conduct of said experiments, are to be met and paid by the said Company.' ## If the foregoing clause stood alone, there would, be, of coure, no question that Mr. Edison would be entitled to immediate repayment of the amount of money spent by him in perfecting the ore milling process for iron concentration. The only question arises under what seems to be an inconsistent reading, or a qualified reading, in the fourth clause of the contract. ## The fourth clause provides for an advance by Mr. Edison to the Company of 2500 shares of the stock held by h im, to be used by the Company 'for the purpose of defraying the expenses necessary to be incurred in exploiting and developing its business.' In the same clause, Mr. Edison agrees 'that he will advance to the said Company, from time to time such moneys as may be necessary to meet its general expensses, to pay for the cost of experiments and for obtainign Letters Patent on inventions made by him and asignable to the said Company, and to construct a special laboratory for the conduct and prosecution of said experiments,' to the amount of $25,000. There then follows a provision that in case his experiments do not result successfully, he shall make no claim on the Company for reimbursement of the amount so advanced by him for experimental or patent purposes, and that, in such case, the amount so advanced by him shall not be in any way regarded as a debt of the Company. ## It is then further provided that 'in case he should succeed, however, in devising a practical system for the extraction of the precious metals from ores, tailings, gravel and other deposits, all moneys advanced by him for the purposes aforesaid, shall be repaid by the Company,' either in cash or stock at the Company's option. ## We are of the opioin that the last two provisions of the fourth clause above referred to do not exclude Mr. Edison from making a claim for reimbursement for moneys spent by him in perfecting the process for iron concentration. Unless the provision in rerspect to precious metals is a substitute for all other provisions of the contract, it would not have the effect of barring his claim growing out of other experiments, and we do not think that the provision in question would be construed as being such a substitute. ## The contract might easily have been drawn to avoid any such question, but upon the reading, as it stands, we believe the Mr. Edison's claim to reimbursement is a valid one, assuming that the experiments such as he has made have resulted satisfactorily."





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Thomas A. Edison Papers, School of Arts and Sciences, Rutgers University
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