Continental Oil Co. v. Elks Nat. Foundation
| Decision Date | 22 February 1989 |
| Docket Number | No. 88-331,88-331 |
| Citation | 767 P.2d 1324,235 Mont. 438,46 St.Rep. 121 |
| Parties | CONTINENTAL OIL COMPANY, a corporation, Petitioner, v. ELKS NATIONAL FOUNDATION, a legal entity; Floyd R. Young; Chad Randall Young by his guardian Sherry L. Young; Joshua Lee Young, by his guardian Sherry L. Young, Michael Edwin Maxwell, by his guardian Shirley G. Johnson; Corinna Nell Maxwell, by her guardian Shirley G. Johnson; Lois E. LaRue Riggins; Sherry L. Young; James Byrd; Joseph Edwin Maxerll, Jr.; Betty Wilson; Mary Jo Byrd; Thomas A. Larson and Gene Huntley, Respondents. |
| Court | Montana Supreme Court |
Chris Mangen, Jr., argued, Carolyn Ostby, Crowley, Haughey, Hanson, Toole & Dietrich, Billings, for petitioner.
Gene Huntley, argued, Baker, for respondents.
James L. Sandall, Billings, for amicus curiae Frank A. Gunnip and Robert P. Schwinn.
W.H. Bellinghan, Billings, for Shell Oil Co.
This is an application for a writ of supervisory control under Rule 17, M.R.App.P. It follows a summary judgment by the District Court for the Sixteenth Judicial District, Fallon County, which adjudicated the ownership of the working interest in an oil and gas lease. We accept supervisory control and reverse the judgment of the District Court.
The issue is whether this Court should issue a writ of supervisory control to determine the extent of Continental Oil Company's ownership in the oil and gas lease.
This case was before the Court previously as Gunnip v. Continental Oil Co. (Mont.1986), 727 P.2d 1315, 43 St.Rep. 1605. That opinion sets forth the complicated history of the ownership of the working interest in the N 1/2 of the NW 1/4 of Section 8, Township 7 North, Range 60 East. In all discussion in this opinion, we are referring to that working interest. In the Gunnip opinion, this Court indicated the ownership of the working interest, as established in previous judgments relating to the property, as follows: half of the N 1/2NW 1/4 in H.W. McDonald, subject to a 1962 ratification agreement with Continental Oil Company (Continental), and the other half of the N 1/2NW 1/4 in Frank Gunnip. Gunnip, 727 P.2d at 1316. The Court remanded the case to District Court for joinder of essential parties and "to assess Continental's interest considering potential application of adverse possession, waiver and estoppel." Gunnip, 727 P.2d at 1317.
The plaintiffs in the present case trace their ownership in the N 1/2NW 1/4 to conveyances from H.W. McDonald subsequent to the 1962 ratification agreement. The effect of the 1962 ratification agreement was argued on remand. The District Court ruled that the intent of the parties to the ratification was that Mr. McDonald conveyed to Continental one half of his interest in the N 1/2NW 1/4. It ruled that the ownership of the N 1/2NW 1/4 is as follows: one half in Frank Gunnip and his assigns, one fourth in plaintiffs, and one fourth in Continental. Continental filed a notice of appeal to which plaintiffs objected because certification had not been obtained from the lower court as required by Rule 54(b), M.R.Civ.P. We allowed an opportunity for the lower court to certify its partial summary judgment, but the court declined to do so. Continental now asks this Court to exercise its power of supervisory control. At oral argument, counsel for plaintiffs joined in the request that this Court determine the interest of Continental in the N 1/2NW 1/4.
Frank Gunnip and his assign Robert Schwinn, who were formerly plaintiffs, have obtained separate counsel and have been redesignated by the lower court as defendants. They have filed a third-party complaint below, asserting their right to one half of the working interest in the N 1/2NW 1/4. In their brief to this Court, they take no position on the application for supervisory control but ask that their one half interest in the working interest in the N 1/2NW 1/4 be acknowledged.
Should this Court issue a writ of supervisory control to determine the extent of Continental's ownership in the oil and gas lease?
Our caselaw has set forth the standard to be employed in determining whether supervisory control under Rule 17, M.R.App.P is warranted. Supervisory control is proper to control the course of litigation when the lower court has made a mistake of law or willfully disregarded the law so that a gross injustice is done and there is no adequate remedy by appeal; also, to prevent extended and needless litigation. State Highway Com'n. v. District Ct., Thirteenth J.D. (1972), 160 Mont. 35, 42-43, 499 P.2d 1228, 1232.
As the opinion in Gunnip stated, the 1962 ratification agreement signed by Mr. McDonald provided that:
... the undersigned, H.W. McDonald, does hereby ratify, adopt and confirm said assignment, in all things with the same force and effect as if the undersigned had been named the assignor therein and had duly executed and delivered said assignment to Continental Oil Company.
For the same consideration, the undersigned does hereby transfer, assign, set over and convey unto Continental Oil Company an undivided one-half ( 1/2) interest in the oil and gas lease above described ...
Gunnip, 727 P.2d at 1316. The plaintiffs argue here, as they did before the District Court, that the ratification is ambiguous so that a court must look beyond the four corners of the document to interpret it. The Court was not persuaded by that argument in Gunnip, nor is it now. We stated:
There remain unresolved issues of material fact regarding the interest of Continental. Although McDonald conveyed an "undivided...
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...in litigating the merits of the case. Regarding the appropriateness of supervisory control, in Continental Oil v. Elks Nat. Foundation (Mont.1989), 767 P.2d 1324, 1326, 46 St.Rep. 121, 123, this Court Supervisory control is proper to control the course of litigation when the lower court has......
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