Dial v. Martin

• Decision Date: 21 January 1931
• Docket Number: No. 3492.,3492.
• Citation: 37 S.W.2d 166
• Parties: DIAL et al. v. MARTIN et al.<SMALL><SUP>*</SUP></SMALL>
• Court: Texas Court of Appeals

37 S.W.2d 166

DIAL et al. v. MARTIN et al.^*

No. 3492.

Court of Civil Appeals of Texas. Amarillo.

January 21, 1931.

Rehearing Denied March 4, 1931.

On Second Motions for Rehearing March 25, 1931.

On Appellees' Second Supplemental Motion for Rehearing April 1, 1931.

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Appeal from District Court, Potter County; W. E. Gee, Judge.

Suit by Gertrude A. Dial, individually and as executrix of the estate of J. C. Dial, deceased, and guardian of Elizabeth and David Dial, minors, and another, against N. H. Martin and others. From a judgment for defendants Martin and others, plaintiffs appeal.

Reversed and remanded.

Lloyd Fletcher, of Amarillo, and H. D. Bishop, of Austin, for appellants.

John E. Green, Jr., and David Proctor, both of Houston, Burney Braly and G. R. Pate, both of Fort Worth, Hamilton & Hamilton of Dallas, J. T. Montgomery and R. C. Stanford, both of Wichita Falls, and Don Emery and Morgan, Morgan & Britain, all of Amarillo, for appellees.

HALL, C. J.

This suit was originally filed in the district court of Hutchinson county, but by agreement was finally transferred to, and tried in, the district court of Potter county. At a former trial, the district court sustained the defendants' general demurrer to the plaintiffs' petition. Plaintiffs appealed, and this court, finding that there was a fatal defect of parties defendant, reversed the judgment and remanded the cause to permit plaintiffs to make necessary parties. 8 S.W.(2d) 241.

Thereafter, Lloyd Fletcher, as guardian ad litem of Elizabeth Dial and David Dial, minors, filed a third amended original petition, making numerous additional parties. Prior to the trial, several of these defendants filed disclaimers, and were dismissed from the action, and the trial proceeded with Lloyd Fletcher, guardian ad litem for Elizabeth and David Dial, minors, and Gertrude A. Dial, in her individual right and executrix of the estate of her deceased husband and guardian of said minors, as plaintiffs. After both sides closed in the introduction of the testimony, the trial judge directed the jury to return a verdict against plaintiffs in favor of N. H. Martin, J. J. Perkins, George E. Martin, W. B. Hamilton of Wichita county, W. B. Hamilton of Dallas county, G. R. Pate, Continental Oil Company, Gulf Production Company, W. D. Cline, Panhandle Refining Company, Phillips Petroleum Company, Goldelline Oil Corporation, Buttram Petroleum Company, and Errett R. Newby. From a judgment entered in accordance with the verdict, this appeal is prosecuted.

It appears that in 1914 J. C. Dial and his brother C. L. Dial entered into a partnership for the purpose of dealing in and raising cattle. This partnership acquired the lands involved in this controversy, on which C. L. Dial, as manager, was conducting the partnership business and was in charge of and managing the partnership property which, in addition to said land, consisted of about 300 cattle. It is conceded that on April 8, 1918, when J. C. Dial died, the lands in controversy were a part of the assets of the partnership; that said lands were incumbered to the extent of about $50,000, which represented part of the purchase price. At the time of J. C. Dial's death, the partnership owned 2,250 head of cattle, which were being grazed on the lands in controversy and certain other lands which the partnership had leased for grazing purposes. The partnership owed other debts amounting to about $100,000 secured by chattel mortgages on the cattle. J. C. Dial was an attorney, and took no active part in the management of the ranch. He was survived by his widow, Gertrude A. Dial, and the two minor children above mentioned, plaintiffs herein. He left a will, which will be hereinafter discussed, and which was probated on May 11, 1918, and his surviving wife, Gertrude A. Dial, appointed executrix. Four days thereafter the probate court entered an order appointing W. H. Dial, the father of J. C. Dial, deceased, as joint executor with Gertrude A. Dial. In December, 1918, C. L. Dial, the surviving member of the partnership, joined by his father, W. H. Dial, as executor, and Gertrude A. Dial, as executrix of the estate of J. C. Dial, deceased, executed and delivered to T. E. Durham an oil and gas lease conveying the mineral estate of the lands in controversy. On March 11, 1922, C. L. Dial, the surviving partner, sold the lands in controversy to N. H. Martin and J. J. Perkins, and was joined in the conveyance by his wife and by Gertrude A. Dial, who executed the conveyance for herself individually and as executrix. The deed was also executed by W. H. Dial as executor.

On March 26, 1926, Gertrude A. Dial, individually and as executrix, as well as guardian of the minor plaintiffs herein, and as next friend of said minors, filed suit numbered 639 upon the docket of the district court of Hutchinson county and entitled Gertrude A. Dial et al. v. N. H. Martin et al. In that suit Mrs. Gertrude A. Dial sought to recover of the defendants the lands involved in this controversy and to set aside and annul the oil and gas lease and the deed above referred to. After that suit was filed, and prior to the 16th of June, 1926, negotiations for the compromise and settlement of the controversy were opened, and on said date Mrs. Dial, as guardian of the minor plaintiffs, made a report to the probate court of Roberts county, where the guardianship proceedings were pending, stating that she had an opportunity to settle the litigation for $212,500, one-half of which would be paid to the minor plaintiffs, and praying for authority to make said compromise. The court heard the application, and on the same day entered an order authorizing the guardian to consummate the settlement in accordance with the terms stated in the application. She then compromised the said suit numbered 639, and, in addition to the money paid, she obtained an oil and gas lease, fully paid up for ten years, upon twenty acres of the land involved herein one-half of said lease being vested in her and the other half in her minor children. On the 19th of June, 1926, an agreed judgment was entered in the district court of Hutchinson county in said cause numbered 639, which confirmed and approved the settlement and adjudicated the issues in accordance with the terms of the compromise agreement. According to the terms of this judgment, the defendants were directed to pay to Gertrude A. Dial $106,250, and to deliver to the bank designated therein as depository the sum of $106,250 for the benefit of the minors Elizabeth and David Dial, and also to deliver the oil and gas lease above referred to. The terms of this judgment were complied with by the appellees herein. On June 19, 1926, Mrs. Dial, as guardian of the minor plaintiffs herein, reported to the probate court of Roberts county that the agreed settlement had been consummated in accordance with the orders of the court, and prayed for a confirmation and approval of her action. The court entered an order of that date which recites that evidence was heard as to the fairness and reasonableness of the settlement, and ordering that said settlement be confirmed.

Later, about December 16, 1926, Mrs. Gertrude A. Dial, as executrix of the estate of J. C. Dial, deceased, and as guardian and next friend of her minor children, Elizabeth and David Dial, filed this suit against N. H. Martin and the other defendants in the original suit and their assignees to recover the lands in controversy. In this action, the minor plaintiffs, represented by their guardian ad litem, seek cancellation of the oil lease and the deed hereinbefore referred to, in so far as it affects their interest in the property involved. They attack the agreed judgment entered in cause No. 639, and pray that it be vacated and annulled, and that they recover title and possession of all of their estate inherited from their father, which they allege to be one-fourth undivided interest in the lands constituting the ranch belonging to the partnership, of which their deceased father was a member.

Since the effect of the agreed judgment is to confirm and validate both the oil and gas lease and the deed, the first question to be considered is whether the appellants, under the record, were entitled to have said judgment vacated. This issue is presented by several propositions and counter-propositions discussed in the briefs of the respective parties.

As preliminary to the determination of that question, it is proper for us to construe the will of J. C. Dial in order to ascertain the nature of the estate taken by Mrs. Gertrude A. Dial and her children under it and the limitation, if any, on the devise to her. And, because the validity of the judgment depends also upon the authority of Mrs. Dial as executrix and guardian, it is necessary to take into consideration the orders and proceedings in the probate court as they relate to her power and authority to bind the children by an agreed judgment.

Omitting the formal and immaterial clauses, the will of J. C. Dial provided, as follows:

"Second. I desire and direct that all of my just debts be paid upon proof of the existence of the same, without delay, and that such proof shall be made of the existence and justness of said debts by the sworn statements of those holding the same and that they be paid by my executrix hereinafter mentioned.

"Third. It is my will and desire and I so direct that all the property of which I may die seized and possessed of, both real and personal, pass to my beloved wife Gertrude A. Dial, after the payment of all just debts and the expenses incident to the probation of this will, subject, however, to the following conditions:

"(a) That the same shall be held by her for the support and maintenance of my children and the support and maintenance of my wife during widowhood.

"(b) That at the end of her widowhood, that all of such property, both...