Boten v. Brecklein
| Citation | 452 S.W.2d 86 |
| Decision Date | 09 March 1970 |
| Docket Number | No. 54316,No. 1,54316,1 |
| Parties | Hubert Ray BOTEN, Sanford W. Boten, and Wesley Boten, (Plaintiffs) Respondents-Appellants, v. Joseph BRECKLEIN and Clarence Fell, (Defendants) Appellants-Respondents |
| Court | United States State Supreme Court of Missouri |
Thos. J. Conway, Kansas City, for respondents-appellants (plaintiffs); Popham, Popham, Conway, Sweeny & Fremont, Kansas City, of counsel.
Alder & Rixner, John J. Alder, Shawnee Mission, Kan., Wiley W. Morrison, Raytown, for appellants-respondents (defendants).
This case arises out of a Managers Agreement relating to three Jackson County, Missouri, oil leases entered into between plaintiffs and defendants on April 17, 1963. The agreement was terminated by defendant on July 8, 1964. Plaintiffs' petition is in three counts. Count I sought actual and punitive damages for alleged fraud of defendants in obtaining plaintiffs' interests in the leases. Count II sought damages for breach of the contract, and Count III alleged that plaintiffs were entitled to recover on quantum meruit. At the conclusion of the evidence the court sustained defendants' motion for a directed verdict on Counts I and III. The jury returned a verdict for plaintiffs on Count II in the amount of $95,000. Defendant have appealed from that judgment. Plaintiffs have appealed from the judgment for defendants on Count I.
Plaintiffs have filed a motion to dismiss the appeal of defendants, alleging that their brief fails to comply with Civil Rule 83.05(c), V.A.M.R. That motion is overruled.
The transcript in this case contains more than 1,100 pages. Much of the evidence relates to the issue as to whether plaintiffs performed the conditions of the managers agreement in the operation of the leases. There was considerable evidence to the effect that they did properly perform, and defendants offered a great deal of evidence which would warrant a finding that they did not. The jury found that issue in favor of plaintiffs. We see no reason for including that evidence in our factual statement. Also, as will hereinafter appear, we will not consider plaintiffs' appeal relating to Count I. We will therefore endeavor to omit facts relating solely to that Count.
Since plaintiffs prevailed in the trial court the facts, to a large extent, will be stated in the light most favorable to them. Matters here involved concern oil leases upon the Longview, Nave, and Jones farms located in Jackson County, Missouri, constituting a total of 2,000 acres. The leases were obtained in 1944 by Raymond Bradford who originally discovered oil thereon and operated the leases until 1961. In that year the leases were assigned to Jacomo Oil Company which had recently been formed. Bradford owned 34 shares in the company, Isaac Zoglin, who agreed to furnish the money for further development, owned 34 shares, and plaintiffs Ray and Sanford Boten each owned 17 shares. The Botens paid no money for their shares but received them for work they had performed, and agreed to perform, in operating the leases. In 1963 Zoglin purchased Bradford's stock so that he had a total of 68 shares, but at that time he agreed that after he was reimbursed for his expenditures he would convey 17 shares to the Botens so that they would own one half of the stock. The Botens drilled three wells for Jacomo which were all producers, and there were 20 old wells, some of which were still producing when Jacomo took over the leases.
In late 1962 Ray Boten became acquainted with defendant Fell while drilling some gas wells for him in Clinton County, Missouri. They discussed the matter of Fell purchasing Zoglin's interest in the leases, or in the corporation. In April 1963 Ray approached Zoglin and discussed the purchase of his interest with the result that an agreement was worked out whereby Zoglin would cause the corporation to sell the leases to Ray for $31,000, with the Botens to surrender their stock in Jacomo so that Zoglin would get all the money. Plaintiffs had an understanding with Fell and his partner, defendant Brecklein, that Ray would immediately transfer the leases to them and that they would furnish the $31,000. In consummating the transaction Attorney William Brandom, a friend and neighbor of Fell, prepared the contract here in question and some of the other papers, and Attorney Kenneth Simon represented Jacomo and Zoglin. There was evidence that the Botens claimed that they should retain a half interest in the leases but that Brandom and Fell stated that could not be done because of tax matters and that they (the Botens) would have to be silent partners. At any rate, the management contract was entered into whereby plaintiffs were to manage the lease without compensation and would have an opportunity to obtain a one-half interest later under provisions of the contract herein set out. Provisions of the management contract that are particularly pertinent to the issues of this case are as follows:
Wesley and Ray Boten had been drilling wells of various kinds since 1941. Sanford had worked through the years on a regular job and only worked with his brothers on the two days a week he had available. Shortly after starting the management of these leases plaintiffs entered into an oral agreement with defendants to drill additional wells at a total cost of $2.00 a foot. It is perhaps of interest to state that on these leases it was only necessary to drill shallow wells as oil was generally found at a depth of from 250 to 300 feet. During the time plaintiffs managed these leases they drilled 15 additional wells, all of which were producers. The receipts from the sale of oil increased from $697.00 in June 1963 to more than $5,000.00 in the month of May 1964. Thereafter, until April 1968, the receipts averaged about $3,000.00 a month.
As we have indicated, there was considerable conflict in the evidence on the issue as to whether plaintiffs operated the leases in an efficient, economical, and workmanlike manner. We have said that we will not state that evidence in detail. It is sufficient to summarize that plaintiffs' testimony indicated that they operated the leases efficiently and kept the premises clean and in good condition, but that the production was not increased to a greater extent because defendants would not permit them to drill more wells; that defendant Fell was continually turning off the wells and reducing production. On the other hand, it was the evidence of defendants that plaintiffs wanted to drill wells but not do any other work; that production was not increased because they would not lay the pipes and do other work necessary to get the wells into production; and that they did not clean up the premises and do other managerial work required under the contract.
As a result of the conflicting views of the parties the defendants, on July 8, 1964, caused their attorney to write the following letter to plaintiffs:
Upon receipt of that letter plaintiffs employed an attorney, Keith Wilson, who immediately advised Mr....
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