Bazemore v. Whittington

• Decision Date: 31 July 1957
• Docket Number: No. 16064.,16064.
• Citation: 245 F.2d 943
• Parties: Garvis I. BAZEMORE, C. T. Ruffin and Goodwyn H. Harris, Jr., Appellants, v. Harmon WHITTINGTON, Charles F. Reed and W. Paul Edman, d/b/a Mid-Century Oil & Gas Company and A. B. Dow, Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

245 F.2d 943 (1957)

Garvis I. BAZEMORE, C. T. Ruffin and Goodwyn H. Harris, Jr., Appellants, v. Harmon WHITTINGTON, Charles F. Reed and W. Paul Edman, d/b/a Mid-Century Oil & Gas Company and A. B. Dow, Appellees.

No. 16064.

United States Court of Appeals Fifth Circuit.

June 10, 1957.

Rehearing Denied July 31, 1957.

Gordon B. Golsan, Jr., Howard E. Spann, Craig, Magee & Spann, Mansfield, La., for appellants.

W. M. Phillips, Marlin Risinger, Jr., W. S. Waller, Shreveport, La., for appellees.

Before RIVES, TUTTLE and BROWN, Circuit Judges.

JOHN R. BROWN, Circuit Judge.

The contention, pressed successfully by plaintiff-appellee Edman and his other Texas associates trading as Mid-Century Oil & Gas Company, was whether, through the operation of the doctrine¹ of after-acquired title, Edman, by a 1951 assignment to him of an earlier (1947) oil and gas lease obtained a lease of the whole rather than one-half of the minerals because, subsequent to the assignment, an outstanding reservation of one-half of the minerals prescribed for non-user. Reaching this result, the District Court rejected the basic defense made there and here by defendant-appellants that the Louisiana policy forbidding² a conveyance of an anticipatory reversion through operation of the liberative prescription would prevent the accomplishment of the same result through the indirect means of the equitable doctrine of after-acquired title. Rejected also was the subsidiary point that the assignment to Edman if properly construed was for a half only so that Edman got exactly what he bought.

We are all in agreement on the basic facts. The chain of title starts here with Keatchie Investment Corporation, the uncontradicted actual and record owner of the full estate in 1941. On October 27, 1941, Keatchie conveyed the whole (127 acres) to Bazemore reserving, however, one-half of the minerals. This mineral servitude, United States v. Nebo Oil Co., supra, 190 F.2d at page 1007, would prescribe for non-user October 27, 1951, and would normally "revert" to Bazemore on that date. On March 11, 1947, Keatchie for an express cash bonus of $127.00 executed a standard (Bath's spec 14-BR 1) oil and gas lease for a ten-year primary term to Robertson Stores, Inc.,³ an Arkansas corporation, covering, "* * * the following described⁴ land in DeSoto Parish * * *," and then stated expressly, "For all purposes of this lease the described premises shall be treated as comprising 127 acres, whether there be more or less." Keatchie expressly warranted⁵ full ownership.

May 1, 1947, by an identical printed form⁶ but for a cash bonus of $317.00, Robertson Stores, Inc., the common grantee, obtained from Bazemore a 10-year lease with like statements and warranties for the same 127 acres.

At that time, of course, Bazemore owned only one-half of the minerals. It is this lease, with its unlimited warranty purporting to convey all which, after a succession⁷ of conveyances expressly covering both halves, was assigned to Edman as to the Bazemore lease only and which is at the bottom of Edman's claim that the half interest expanded a few months later into a full lease when the Keatchie reservation of the mineral servitude prescribed October 27, 1951.

Thus the title stood when, April 16, 1951, Edman obtained from Robertson Oil Company, Inc., an assignment (without express warranty) of many leases covering:

"All of its right, title and interest in and to all of the following described oil, gas and mineral leases covering lands situated in DeSoto Parish, Louisiana, to-wit: * * *"

but carefully limiting the description to the Bazemore lease (note 6, supra):

"10. Lease executed by Garvis I. Bazemore in favor of Robertson Stores, Inc., dated May 1st, 1947, recorded under Registry Number 186618, Conveyance Records of DeSoto Parish, Louisiana, which covers and affects an undivided one-half interest in here follows metes and bounds, note 6, supra * * * the 127 acres involved.

By construing the phrase "* * which covers and affects an undivided one-half interest" in the lease as describing merely the present state of the title, the District Court concluded that the assignment covered a lease of the whole, not half. That being so, when the Keatchie one-half reverted to Bazemore by prescription October 27, 1951, application of the doctrine of after-acquired title would effectuate a full conveyance.

Judges RIVES and TUTTLE agree with the District Court on this construction and do not concur in the following exposition of the views by Judge BROWN in support of his contrary conclusion with which they disagree.

This construction of the District Court, especially in the light of the Conveyance Record, note 7, supra, McDuffie v. Walker, 125 La. 167, 51 So. 100; Cole v. Richmond, 156 La. 262, 100 So. 419, and without which Edman would not have the opportunity of seeking the benefit of the warranties in the Bazemore 1947 lease, seems clearly incorrect. First, if the present tense is significant in the description of the existing state of the title of the lease conveyed, it is equally plausible that the granting clause, "* * has bargained, sold, transferred, assigned and conveyed, and by these presents does bargain, sell, transfer, assign and convey * * * all of its right, title and interest * * *" speaks likewise in the present. The assignment, without express warranties, in terms of "all of its right, title and interest" 133 F.Supp. 165. indicates a purpose to convey what it then owned, Waterman v. Tidewater Associated Oil Co., supra, and note 7, supra, and not a purpose to convey that which was not then owned but which might⁸ thereafter accrue.

And from Edman's point of view, to particularize with care the one specific lease (Bazemore) when the entire chain of title showed that the common grantee (Robertson Stores, Inc.) and all of its successors considered⁹ that a full lease was obtained only by specific assignments of both the Bazemore and Keatchie leases, reflects a purpose to acquire one but not the other. Had it seriously been the intention¹⁰ to obtain the lease of the whole (not half), Edman, as had all of his predecessors, would have insisted that the assignment expressly describe both leases. But instead of doing this, Edman referred to one only, and then made the expectation doubly clear by correctly characterizing the lease thus incorporated by reference as "* * * an undivided one half interest in" the leasehold estate. Why Edman carefully chose to accept one and not require the other does not appear. Had he, as his predecessors, required that both be expressly mentioned, it was obvious that one-half of the lease would likely fail when Keatchie's servitude prescribed a few months hence. Perhaps it was because of this that he felt the short time left would not justify cost or expense.

And it strains language in this setting to think that through a phrase as equivocal as "which covers and affects" it was the expectation that, mentioning the Bazemore lease alone and omitting all reference to the Keatchie lease, he would actually get more than had he specified both. If Edman's probable answer to this is the suggestion that reference was deliberately restricted to one (Bazemore) and the exclusion of the other (Keatchie) because a skilled title examiner could see that after-acquired title would give more than an express conveyance of both, then a proper regard for the original 1947 warranties further demonstrates that Edman neither obtained an additional title nor was it intended that he should.

This analysis proceeds on the premise that the doctrine of after-acquired title is an importation of non-Codal equitable concepts to effectuate the warranties¹¹ imposed by the Louisiana Code. And if, on this title record, Robertson Stores, Inc., had no real enforceable rights of recovery against Bazemore on the 1947 warranties, Edman acquired none by subrogation to the rights of Robertson Stores, Inc.

While the warranty was unqualified and the lease purported to cover the whole¹² (not one-half), Robertson Stores, Inc., as the common grantee from the two admitted, sole owners of the minerals, had no enforceable recoveries against Bazemore had it, for example, in 1948 or 1949 sued him on the warranties. Robertson Stores, Inc., by the prior Keatchie lease, knowing the state of the title and, indeed, in a position where, absent an eviction, it could not dispute or deny its lessor's (Keatchie's) title, Sabine Lumber Co. v. Broderick, 5 Cir., 88 F.2d 586, 588, certiorari denied 302 U.S. 711, 58 S.Ct. 31, 82 L.Ed. 549 and see extensive citations Art. 2710 of the Louisiana Civil Code Annotated, LSA-C.C., under headings 15, 18, was aware of the "defect" in its vendor's (Bazemore's) title and consequently could not recover damages,¹³ as such.

It could not rescind the purchase since, having itself just previously obtained a ten-year lease from the uncontradicted owner of one-half of the minerals, it could not, as required by Art. 2511 of the Code, show that the transaction with Bazemore was made on the expectation that he owned all and would not have been entered into at all had Bazemore not "misrepresented" the extent of his title.¹⁴ Nor, for the same reasons, after failing to satisfy Article 2511, could it have met the implications¹⁵ of Article 2514 that, while it would yet have been willing in effect to consummate the transaction had the fact of a lesser title been known, the purchase price would have been less¹⁶ and should hence be reimbursed "proportionably."

Nor, unable to recover damages, the whole or part of the purchase price or rescind, would it have fared any better on the claim of eviction. For here, the warrantor is liable for a constructive eviction only when there is a perfect title outstanding in a third person at the time of the sale.¹⁷ After these two transactions with Keatchie and Bazemore, the half which Bazemore theoretically "sold" and warranted but which he did not own was not...