"There is involved in this cause pending here a construction of these two contracts between Drow and wife and Magill, trustee:
"First Contract.
"`State of Texas, County of Matagorda:
"`This memoranda witnesseth: W. H. Drowatzky and his wife, Minnie E. Drowatzky, of the county and state aforesaid, for the consideration hereinafter named, have this day sold to G. M. Magill, trustee, an undivided one-half interest in and to the east half of lot six (6) of subdivision of the Henry Parker league located in Matagorda county, Texas, and an undivided one-half interest in and to the lease contract executed by the said Drowatzky and wife to F. J. Hardy on the 16th day of May, 1908, to which reference is hereby made and said lease is made a part hereof.
"`The consideration for the property above named is the payment of G. M. Magill, trustee, of thirteen thousand dollars ($13,000.00) as hereinafter provided, and on the conditions herein named, to wit, three hundred dollars ($300.00) cash, the receipt whereof is hereby acknowledged, and twenty-seven hundred dollars ($2,700.00) to be paid within five (5) days from the date hereof, on the sole condition that the title to said property is good and vested in the grantors hereinbefore named. If the title is found good then the three thousand dollars ($3,000.00) hereinbefore said and provided to be paid shall in no event be repaid to the said trustee, G. M. Magill.
"`If the said F. J. Hardy, or the Hardy Oil Company, or their assigns, shall bring in an oil well upon the said property that produces as much as fifteen hundred (1,500) barrels of oil in twenty-four (24) hours, then the said G. M. Magill, trustee, shall within fifteen (15) days thereafter pay to the said Drowatzky and wife the sum of ten thousand dollars ($10,000.00), upon the delivery to said G. M. Magill, or his nominees, a good and sufficient deed to the property herein described and agreed to be sold.
"`In the event a well should be brought in on said property that produces less than fifteen hundred (1,500) barrels of oil per day of twenty-four (24) hours, then the said G. M. Magill, trustee, shall have the right to pay the said ten thousand dollars ($10,000.00) as hereinbefore provided, but shall not be required to do so unless he so elects. Provided, however, that the said G. M. Magill, trustee, shall have no right to demand a deed or any right in the said royalty until the said additional ten thousand dollars ($10,000.00), is fully paid, as aforesaid, but the payment of said ten thousand dollars ($10,000.00) entitles said G. M. Magill, trustee, to a full one-half of said royalty from the beginning of production.
"`This contract is executed in duplicate, each to have force and effect as an original, and both copies shall be deposited in escrow in the Bay City Bank & Trust Company for the period of five (5) days, pending the examination of the title and the payment of the balance of twenty-seven hundred dollars ($2,700.00).
"`Witness our hands this 12th day of June
A. D. 1908. W. H. Drowatzky
"`Minnie E. Drowatzky
"`I hereby accept the above contract.
"`G. M. Magill.'
"Second Contract.
"`The State of Texas, County of Bexar:
"`Know all men by these presents, that whereas the undersigned, W. H. Drow and wife, Minnie E. Drow, their names then being W. H. Drowatzky and Minnie E. Drowatzky, which names have since been changed in conformity with the laws of the state of Texas, to Drow, sold to G. M. Magill, trustee, an undivided one-half interest in and to the east half of lot 6 of the subdivision of the Henry Parker league located in Matagorda county, Tex., and an undivided one-half interest in and to a lease contract executed by the said W. H. Drowatzky and wife, Minnie E. Drowatzky to F. J. Hardy, which lease has, prior to this date, been terminated; and whereas a new lease has been made by said W. H. Drow and wife, Minnie E. Drow, on the said premises to D. B. Cherry for a one-eighth royalty running for 20 years and dated September 29, 1910, to the whole of the said 80 acres, filed for record on October 20, 1910, and recorded in the deed records of Matagorda county, Tex., in volume 30, pp. 441 to 443, to G. M. Magill, trustee, that said Magill should pay $10,000 additional for the said undivided one-half interest when an oil well shall have been brought in upon the said property which produced as much as 1,500 barrels of oil in 24 hours; and whereas a well had been brought in on the said premises which produces less than the aforesaid amount, and the parties hereto desire to make an equitable adjustment in view of that circumstance: Now, therefore, in consideration of the premises, the said G. M. Magill has this day paid to the said W. H. Drow and wife, Minnie E. Drow, the sum of $1,000 cash, the receipt of which is by them hereby acknowledged, and the oil produced from the said land shall be run into pipe lines of some responsible pipe line company or companies, one-half to the credit of the said W. H. Drow and wife, and one-half to the credit of G. M. Magill, trustee, and when sufficient shall have been run to the credit of G. M. Magill, trustee, to be of the value of $1,000 at the current market price, then the said G. M. Magill, trustee, shall within five days thereafter pay to the said W. H. Drow and wife, or place to their credit in the State Bank & Trust Company of San Antonio, Tex., an additional $1,000, upon the same conditions, and so on until the entire unpaid balance of the said $10,000 shall have been duly paid, or, at the election of said trustee, he may pay the unpaid balance of the $10,000 mentioned in the aforesaid instrument, provided, that if at any time a well shall be brought in on the said premises, which produces as much as 1,500 barrels of oil in 24 hours, then and in that event the remaining unpaid balance of the said $10,000 shall be paid to the said W. H. Drow and wife by the said G. M. Magill, trustee, within 15 days after demand is made for same. And in the event that said Magill, trustee, shall fail to make the balance of the payments as above provided, this contract shall become null and void and of no further force and effect, and said Magill, trustee, shall forfeit all rights hereto, in land and royalty.
"`The instrument hereinbefore referred to between the said W. H. Drow and Minnie E. Drow is dated June 12, 1908, and is recorded in the deed records of Matagorda county, Tex., in volume 30, p. 396, and the same is made a part hereof and shall in all respects be continued in full force and effect, subject only to such modifications as made by this instrument, and the said G. M. Magill, trustee, hereby ratifies and confirms the aforesaid lease to D. B. Cherry.
"`Executed in duplicate originals, by said W. H. Drow and Minnie E. Drow and G. M. Magill, trustee, on this 15th day of April, A. D. 1912.
"`In testimony whereof, witness our hands, this the 15th day of April, A. D. 1912.
"`W. H. Drow
"`Minnie E. Drow
"`G. M. Magill, Trustee.'
"Drow and wife, subject only to the oil leases then severally recited to be outstanding, owned
the land therein described at the dates of these contracts, which, as well as the oil leases therein referred to, were upon execution duly filed and recorded in Matagorda county; the one-half interest in the land and the Hardy and Cherry oil leases thereon, as respectively described in the instruments, went to Magill, as trustee for the appellants Cheek and Akin, among others; subsequently, on October 31, 1923, Callie M. Metzer, the appellee herein, bought the land with both actual and constructive notice of all these referred to oil leases and contracts affecting the same, and expressly subject thereto, thereby acquiring all the title Drow and wife had and becoming subrogated to all their rights under the two copied contracts; appellants and their associates paid $3,000 in cash under the first contract of June 12, 1908, and $2,000 in cash and returns from oil produced from the land during the year 1913 under the second contract of April 15, 1912, nothing further ever having been paid; exclusive of any oil-bearing or other mineral value, the land in controversy was worth at the time of the execution of the two contracts involved not over $1,250; the Hardy lease was canceled and surrendered without any oil ever having been produced thereunder, while an oil well, which, however, never produced as much as 1,500 barrels in any 24-hour period, was brought in under the Cherry lease and produced oil for a short time, then ceased entirely and finally; although operations were continued under this...
