Dial v. Martin

• Decision Date: 30 May 1928
• Docket Number: (No. 3014.)
• Citation: 8 S.W.2d 241
• Parties: DIAL et al. v. MARTIN et al.
• Court: Texas Court of Appeals

8 S.W.2d 241

DIAL et al. v. MARTIN et al.

(No. 3014.)

Court of Civil Appeals of Texas. Amarillo.

May 30, 1928.

Rehearing Denied June 27, 1928.

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

Action by Mrs. Gertrude A. Dial and others against N. H. Martin and others. From a judgment of dismissal, plaintiffs appeal. Affirmed in part, and reversed and remanded in part.

Fletcher & Bishop, of Amarillo, and W. B. Harrell, of Dallas, for appellants.

David Proctor, of Fort Worth, and Carrigan, Britain, Morgan & King, of Amarillo, for appellee Gulf Production Co.

J. T. Montgomery and R. C. Stanford, both of Wichita Falls, for appellees Cline and Panhandle Refining Co.

Lydick, McPherren & Jordan, of Oklahoma City, Okl., for appellee Umpleby.

Don Emery, of Amarillo, for appellee Phillips Petroleum Co.

Wm. J. Rieker and Burney Braly, both of Fort Worth, for appellee Marland Oil Co.

G. R. Pate, of Wichita Falls, for appellee Hamilton.

W. B. Hamilton, of Dallas, for appellees Martin and others.

HALL, C. J.

This action was originally instituted in the district court of Hutchinson county, and was, by some of the defendants, removed to the federal court at Amarillo. Afterward, by agreement of all parties, the case was transferred to the district court of Potter county. The original suit was filed by Mrs. Dial for herself and as executrix of the estate of her husband, J. C. Dial, deceased, and as guardian and next friend of her two minor children, David and Elizabeth, against the appellees and Lee Bivens. Bivens is not a party to this appeal.

After the case was transferred to the district court of Potter county, the court entered an order appointing Lloyd Fletcher, one of the attorneys of record for the plaintiffs, as guardian ad litem of the minors, David and Elizabeth Dial. Fletcher, as such guardian ad litem, filed his amended petition naming as defendants the following appellees: N. H. Martin, J. J. Perkins, W. B. Hamilton of Wichita Falls, W. B. Hamilton of Dallas, W. D. Cline, G. R. Pate, George E. Martin, Errett R. Newby, J. B. Umpleby, Tom E. Durham, and the following corporations: Panhandle Refining Company, Gulf Production Company, Goldeline Oil Corporation, Buttram Petroleum Corporation, Marland Oil Company of Texas, and Phillips Petroleum Corporation.

After the filing of this petition by Fletcher, as guardian ad litem, Mrs. Dial filed her amended petition, as executrix of the estate of J. C. Dial, deceased, adopting the allegations and prayer contained in the pleading filed by Fletcher.

The petition, with its exhibits, comprises about 130 pages of the transcript, and since the trial judge sustained a general demurrer and numerous special exceptions to it, and upon the refusal of the plaintiffs to amend, dismissed the action, from which order this appeal is prosecuted, it is necessary for us to set out briefly the material allegations of such pleading.

After the formal parts of the petition plaintiffs allege that the suit is brought to set aside a certain oil and gas lease, a certain deed of conveyance, and a certain judgment under which all the defendants are asserting some character of claim or right to certain lands in Hutchinson county, Tex., which are fully described in the petition. This is followed by a count in the form of trespass to try title.

Following these formal allegations, it is alleged that the minors, Elizabeth and David, derived title to the lands as the heirs of their father, J. C. Dial, who died April 8, 1918, leaving a will naming their mother, Mrs. Gertrude A. Dial, as executrix, with certain powers as shown by the will (attached as an exhibit). The terms of the will are set out, and it is alleged that it was probated upon the application of Mrs. Dial and W. H. Dial, on May 11, 1918, and that the probate court ordered that letters testamentary be issued to Gertrude A. Dial; that on May 14, 1918, Mrs. Dial and W. H. Dial, her father-in-law, made and filed an affidavit in the probate court, which recites that J. C. Dial, just before his death, said that he wished his father, W. H. Dial, to assist his wife, Mrs. Gertrude A. Dial; in the administration of his estate, and desired that they be appointed and act jointly as executrix and executor; that on May 15, 1918, the probate court entered an order reciting the facts shown in the affidavit and that all parties in interest had agreed thereto, and appointed W. H. Dial joint executor, ordering him to act jointly with Mrs. Dial. Further allegations are made with reference to the power of Mrs. Dial and W. H. Dial to act, which will be considered hereafter.

It is further alleged that he real estate involved in this action, consisting of about 20 sections of land, was at the time of the death of J. C. Dial the partnership property of Dial Bros., a firm composed of J. C. Dial and C. L. Dial; that said firm was operating a ranch under the firm name; that under the terms of the will of J. C. Dial, his interest, upon his death, descended to and vested in the minor plaintiffs in fee simple; that the defendants are claiming some interest in said land by reason of a purported oil and gas lease. Said lease is attached and made a part of the petition dated November 30, 1918, and in addition to the stipulations of an ordinary gas lease, contains this recitation:

"This agreement was made and entered into November 30, 1918, by and between Dial Bros., a firm composed of C. L. Dial and J. C. Dial, by C. L. Dial, W. H. Dial, executor, and Gertrude A. Dial, executrix, for the estate of J. C. Dial, deceased, of Hutchinson county, Texas, hereinafter called lessor, and Thomas Durham, of Potter county, Texas, lessee, witnesseth."

The lease recites a consideration of $10 cash in hand paid; provides for development or the payment of annual rental, in lieu of development, in the sum of $2,761. It is signed, "C. L. Dial," "W. H. Dial, Executor of the Estate of J. C. Dial, Deceased," "Gertrude A. Dial, Executrix of the Estate of J. C. Dial, Deceased," and was duly acknowledged and recorded.

The petition attacks this lease as being void upon the following grounds:

(a) Because the partnership of Dial Bros. had previously been dissolved by the death of J. C. Dial, and none of the grantors had authority to act for or in the name of the partnership in executing said lease.

(b) Because C. L. Dial had no authority to act for or in the name of the partnership and did not assume to so act, and did not act or assume to act as surviving partner, and said lease was not executed for the purpose of winding up the partnership.

(c) Because W. H. Dial and Gertrude A. Dial had no power as individuals or in any representative capacity, either alone or in connection with C. L. Dial, to do any act with reference to the late partnership, for any purpose.

(d) That there was no consideration for the execution of the lease.

(e) That no application had ever been made to the probate court for authority to make the lease, and no authority had been granted, and that there was no necessity for making said lease.

(f) That W. H. Dial and Gertrude A. Dial, in violation of their trust, in making the lease were not acting for the estate of said minors, but were acting with C. L. Dial in their own interest and against the interest of the minors, and the lease was made without the authority of the probate court, and without any consideration.

(g) That the lessee, Tom Durham, was president of the National Bank of Commerce at Amarillo, and W. H. Dial and C. L. Dial were indebted to said bank and seeking further credit, and that the lease was made in their own interest and in fraud of the interest of the minors; that Gertrude A. Dial signed it at the request of W. H. and C. L. Dial and Tom Durham, upon their representation that the same was for the best interest of the estate of J. C. Dial, deceased, when, in fact, it was against its interests, and that all the defendants knew all of said facts before they acquired any interest under the lease.

It is further alleged that on March 11, 1922, C. L. Dial and wife, Lelia Dial, W. H. Dial, and Gertrude A. Dial, in their fiduciary capacities, executed a deed conveying the lands in controversy to N. H. Martin and J. J. Perkins, which deed is attached as an exhibit. It is a warranty deed, reciting a consideration of $96,000 paid and to be paid as thereinafter specified; also the further consideration of the payment of certain community debts against the estate of J. C. Dial and wife, which debts are listed and fully described in the deed. The deed recites that due proof of the justness of said debts has been made by sworn statement of the creditors, and that said debts existed at the time of the death of said Dial. It is further recited that there was not sufficient personal property to pay said indebtedness or any substantial part thereof, and that there existed a necessity to sell the property to pay said debts. The petition attacks the deed as being void for the following reasons:

(a) That there was no consideration for the deed, and that the purported consideration of $96,000 was never paid. That the recited consideration that the grantees had assumed to pay the debts named in the deed is false. That said indebtedness was not paid at the time of the execution of the deed and it was therefore without consideration.

(b) That the recital that the indebtedness named constituted community debts was not true. That if such debts existed, they were the debts of C. L. Dial, W. H. Dial, and Gertrude A. Dial.

(c) That if said debts were assumed or paid, that the same was without authority, either in fact or law, and such payment was without the request of Gertrude A. Dial or the said minors, or any one acting for them.

(d) That if the debts were a charge against the estate of the minors, the payment, if made, was without authority and was made by the defendants with the fraudulent purpose of acquiring the interest of the said...