Cobb v. Newman

• Decision Date: 08 March 1949
• Docket Number: Case Number: 33391
• Citation: 205 P.2d 858,1949 OK 37,201 Okla. 318
• Parties: COBB v. NEWMAN
• Court: Oklahoma Supreme Court

1949 OK 37

205 P.2d 858

201 Okla. 318

COBB v. NEWMAN

Case Number: 33391

Supreme Court of Oklahoma

Decided: March 8, 1949

Syllabus

¶0 1. WILLS - Intention of testator governs.

The object and prime purpose in the construction of any will is to arrive at and give effect to the intention of the testator. And in ascertaining such intention the will is to be considered as a whole and the several provisions thereof in their relation to each other.

2. SAME - Conditions of will consistent with title devised and valid.

Where in one paragraph of a will there is a specific devise of land in fee simple and in another paragraph dealing expressly with such devise there is prescribed a condition to the effect that the title so devised is to be defeated in part upon a contingency if same occurs during the ownership of the devisee, held, the condition is consistent with the title devised and valid.

3. TRUSTS - Validity of sale where cestui que trust consents and acquiesces in transaction.

A person cannot legally purchase on his own account that which his duty or trust requires him to sell on account of another, nor purchase on account of another that which he sells on his own account. He is not allowed to unite the two opposite positions of buyer and seller. In such situation the law will avoid the transaction at the instance of the cestui que trust even though the sale was without fraud, the property was sold for its full value and no actual injury to his interests is proven. Such sale, however, is not void but voidable only and where the cestui que trust consents to or acquiesces in such transaction the sale is valid and binding upon him.

4. CORPORATIONS - Grantees as stockholders not entitled to avoid deeds, where all stockholders request and join in execution of deeds by corporation.

Where all of the stockholders request and join in the execution of deeds by the corporation whereby an estate in the corporate real estate is conveyed in severalty to the stockholders as grantees, such grantees as stockholders are not entitled to avoid such deeds.

Appeal from District Court, Atoka County; Sam Sullivan, Judge.

Action to quiet title and for money judgment by Louesa Newman and others against Antonia Cobb and others. Judgment for plaintiffs, and certain of the defendants appeal. Affirmed in part and reversed in part.

Guy L. Andrews, of McAlester, for plaintiffs in error.

Utterback & Utterback, of Durant, for defendants in error.

GIBSON, J.

¶1 This action was instituted by Louesa Newman, joined by her husband, Nelson Newman; Pauline Palmer, joined by her husband, W.S. Palmer; and Mary Inez Temple, joined by her husband, W.H. Temple, as plaintiffs, against Antonia Cobb and her husband, J.R. Cobb; L.C. Kuyrkendall and his wife, Ione Kuyrkendall, and O.A. Kuyrkendall and his wife, Josephine Kuyrkendall. Therein is sought a judicial determination of the respective interests of plaintiffs and defendants in the mineral estate in lands, also judgments for plaintiffs' alleged proportionate parts of money received by one of defendants as bonus for oil and gas lease, covering the mineral interest in a part of the lands involved, and other relief. Later, D. O. K. Land and Cattle Company, an Oklahoma corporation, was made a party defendant by order of court. Plaintiffs were awarded judgment and the defendants, other than O.A. Kuyrkendall and wife, prosecute the appeal. The parties to the appeal will be referred to herein as they appeared in the trial court.

¶2 The original parties to the action, other than those named as spouses, are children of J.O. Kuyrkendall, who died testate. The mineral interests involved attach to lands that were devised in severalty to the children, and the question in issue involves, among other things, a construction of the will. The will was duly probated in the county court of Atoka county, and decree of distribution was entered on May 30, 1932.

¶3 Testator died seized in fee of several tracts of land and possessed of the controlling stock in said corporation which had extensive holdings in lands which were devoted primarily to stock raising and included two ranches.

¶4 The corporation was capitalized at 1,200 shares of the par value of $25 each. Testator was owner of 879 of the shares. Defendant O.A. Kuyrkendall, who was manager of the corporation during his father's lifetime, succeeded to the presidency thereof upon his father's death, and was one of the executors of the will, and owned 316 shares. And plaintiff Nelson Newman, son-in-law of testator, who was secretary-treasurer of the corporation, owned 5 shares.

¶5 Item III of the will provides:

"I direct that all mu just debts be paid out of my estate, and if there be not sufficient money on hand at the time of my death to pay same, then, I direct that each of the legatees hereunder bear an equal share in the payment thereof. To this end I direct that all real property herein devised, which is revenue bearing in the way of rentals and all my stock in D. O. K. L & C. Co., be kept intact by my hereinafter named executors and the revenues and rentals therefrom, and the dividends arising from said stock in the D. O. K. L. & C. Company, after paying the taxes, expenses and upkeep of such property be applied to the payment of said indebtedness, and that after the payment of same, that said property be divided as herein specified.

"I desire it understood, however, that the above mentioned indebtedness is not meant to include mortgage indebtedness, against any of the lands herein devised, including ranch lands, nor are the above mentioned rentals to be revenue arising from farm lands."

¶6 Under Items IV to IX, inclusive, there is devised in severalty to the six children definite parts of the lands of which the testator died seized, and therewith is bequeathed to each devisee a definite number of the shares of stock, such bequests aggregating all of the stock of the corporation of which testator was possessed.

¶7 Item XIV is as follows:

"Whereas in this will I have given and bequeathed to my within named children, Louesa Newman, Antonio Cobb, Mary Inez Temple, Dr. L.C. Luyrkendall and O.A. Kuyrkendall certain lands and lots, and certain stock in the D. O. K. Land & Cattle Company, said stock conveying an interest in lands, Now as a part and parcel of said bequests, I desire to add the following conditions:

"At my death, my said within named children shall take said lands and stock conveying an interest in lands herein bequeathed to them in fee simple including interest in lands of the D. O. K. Land & Cattle Company, as shown by the stock in said company herein bequeathed to them,

"Conditioned, that should oil, gas, or valuable mineral be discovered upon any of said land bequeathed to any of the above named children, should said oil, gas, or valuable mineral be produced, mined or sold or royalties paid thereon while said land is owned by any child or children above named, then in that event said oil, gas or valuable mineral shall be the property of all my said children above named and they shall participate, share and share alike in such gas, oil or valuable mineral and in all profits and royalties arising therefrom.

"Provided, that nothing in this condition herein imposed or the terms and conditions thereof, shall be understood or constructed to act as a restriction upon the sale of any of the lands described and bequeathed herein to any of my said children before the discovery or production of any oil, gas, or valuable mineral upon said land. That is to say, that before the discovery or production of any such oil, gas or valuable mineral upon any of the lands herein bequeathed, the child or children to whom such land is bequeathed are at liberty to sell or otherwise dispose of same, without restriction and convey good title thereto."

¶8 Under the decree of distribution, to which there was no objection and from which there was no appeal, the lands so devised were distributed to the devisees subject to the condition prescribed in Item XIV.

¶9 The devisees mutually agreed to abide the terms of the will and to cooperate in the attempt to effectuate the testator's intention. The indebtedness of the estate and that of the corporation, the main source of the estate's revenue, was such that extraordinary measures were required. In January, 1932, one of the ranches was sold. The amount realized therefrom was sufficient to retire the corporate indebtedness (except a note for about $13,000 to be mentioned later) the indebtedness of the estate and to declare a divident sufficient to enable the stockholders to retire the indebtedness that constituted charges upon the specific devises.

¶10 Stock certificates were issued to the distributees in accordance with their respective ownerships. And on July 2, 1932, at a called meeting of the stockholders of the corporation, at which all were present and participating, a resolution was unanimously adopted authorizing the corporation to execute deeds conveying in severalty to the devisees as tenants in common the mineral estate in the remaining lands of the corporation in accordance with the terms of the will.

¶11 By deeds bearing date of August 1, 1932, the corporation conveyed the mineral interests accordingly. All of the stockholders other than the grantee named therein executed each deed as co-grantor. And under date of August 11, 1932, the grantees entered into a written stipulation with the corporation whereby they severally covenanted to become personally liable to the extent of their respective ownership of any fund arising from the sale of leases or from oil and gas rentals or royalties on the mineral estate granted, for the payment of said $13,000 indebtedness, if corporate funds were not available therefor.

¶12 Pending the completion of the conveyances the corporation and stockholders joined in the execution of an oil and gas lease upon a part of the premises and after the completion a written stipulation was executed whereby all...