Douglas Oil Co. v. State, 7533.

• Decision Date: 15 November 1933
• Docket Number: No. 7533.,7533.
• Citation: 70 S.W.2d 452
• Parties: DOUGLAS OIL CO. et al. v. STATE et al. (CALIFORNIA CASE).
• Court: Texas Court of Appeals

Page 452

70 S.W.2d 452

DOUGLAS OIL CO. et al. v. STATE et al. (CALIFORNIA CASE).

No. 7533.

Court of Civil Appeals of Texas. Austin.

November 15, 1933.

Rehearing Denied and Arguments Overruled March 7, 1934.

Appeal from District Court, Travis County; George Calhoun, Judge.

Suit by the State against the Douglas Oil Company and others. Judgment for plaintiff, and defendants appealed. The Court of Civil Appeals certified questions to the Supreme Court, which returned answers thereto . On submission after answers to the certified questions.

Judgment modified and affirmed.

Jno. A. Braly, of Fort Worth, for appellant Southland Royalty Co.

John Rogers, of Tulsa, Okl., and Smith & Neill, of San Angelo, for appellants J. A. Chapman and McMan Oil & Gas Co. Baker, Botts, Parker & Garwood, of Houston, and E. F. Smith, of Austin, for appellant Frank Pickrell.

Harris, Harris & Sedberry, of San Angelo, for appellants Peerless Oil & Gas Co., J. R. Parten, and L. R. Kershaw.

J. H. Maxey, Chas. A. Holden, Wilbur J. Holleman, and Leahy, Maxey, Macdonald & Holden, all of Tulsa, Okl., and Gibbs & Lewis, of San Angelo, for appellant Douglas Oil Co.

James V. Allred, Atty. Gen., and R. W. Yarborough, Asst. Atty. Gen., for the State.

W. B. Silliman, of Fort Stockton, Cantey, Hanger & McMahon, of Fort Worth, and C. W. Trueheart, of Longview, for appellee Bob Reid.

Thompson, Knight, Baker & Harris, of Dallas, and Turney, Burges, Culwell & Pollard, of El Paso, for appellee California Co.

McCLENDON, Chief Justice.

This suit (popularly called California Case) involves, as its controlling question, the proper location of surveys 34 and 35 in block 194, G. C. & S. F. Ry. Co., in Pecos county. As such it was companion to another case of the same style pending in this court popularly called Whiteside Case, and to the Smith-Turner Case pending in the Supreme Court. The boundary issue has been determined by the Supreme Court. 61 S.W.(2d) 807. See, also, opinions in the Whiteside Case (Tex. Sup.) 61 S.W.(2d) 804, and in the Smith-Turner Case (Tex. Sup.) 61 S.W.(2d) 792. The area involved in the instant case is the entire shaded portion in the following map, referred to hereafter as tract 1. The western strip of this shaded tract, which includes the four oil wells numbered 1, 7, 11, and 12, will be referred to as tract No. 2 (also sometimes called Fred Turner, Jr., survey No. 7); and the eastern strip will be referred to as tract No. 3 (sometimes called the Bob Reid tract):

NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE

The relative position of this land in block 194, in accordance with the Supreme Court's adjudication, which also accords with the trial court's judgment in this case, is shown in map, 61 S.W.(2d) 792, 797.

After the Supreme Court's answers to the certified questions, the case was reset for submission and oral argument in this court, our order providing: "In the meantime counsel are requested either to re-brief the case, or file further briefs or arguments, in the light of the answers of the Supreme Court to the questions certified; and eliminate such questions or issues as are determined by such answers."

J. A. Chapman and McMan Oil & Gas Company (to whom we shall refer as appellants) are the only appellants who have complied with this order. We therefore assume that the remaining appellants have reached the conclusion that the Supreme Court's adjudication requires an affirmance of the trial court's judgment—a conclusion in which we fully concur.

Appellants are fractional royalty owners under a lease held by the California Company, covering section 35, and one of the appellants owns additionally a fractional mineral title to that section subject to the California Company's lease. This is the only interest of any character that appellants have ever asserted in the subject-matter of this suit.

Section 35 was patented in 1886 without reservation of mineral. March 5, 1924, its then owners executed the above-mentioned oil and gas lease to appellee California Company, which lease covered the entire section.

Section 34 (an alternate school fund survey) was sold in 1908 with reservation of the minerals in the school fund. In 1924, its then owner, for himself and as agent of the state, executed an oil and gas lease to the California Company, covering the entire section, under the provisions of R. C. S., art. 5367 et seq., known as the Relinquishment Act.

The west line of tract No. 2 (Fred Turner, Jr., survey No. 7) is coincident with the common boundary line of sections 35 (east line) and 34 (west line) as fixed by the "First Method" (course and distance from east line of block Z, T. C. Ry. Co.) adjudicated by the Supreme Court to be the correct locative method. 61 S.W.(2d) 807. The east line of tract No. 2 is coincident with the common boundary lines of sections 34 and 35, located according to the "Second Method," which was rejected by the Supreme Court.

Upon the manifestly untenable theory of a vacancy between sections 34 and 35, Fred Turner, Jr., made application to purchase and was awarded tract No. 2.

The contentions which appellants now urge may be reduced to three and stated substantially as follows:

(1) There was no pleading to support that portion of the trial court's judgment quieting as to appellants California Company's title to its oil and gas lease on section 34.

(2) Error of the trial court in overruling (a) a plea of privilege to change the venue; (b) a motion to permit a trial amendment; and (c) a motion to require the state, Turner, and the California Company to replead; all filed after the evidence was closed and before the case went to the jury; and each predicated upon an agreement between the state, Turner, Reid, and the California Company, made after close of the evidence.

(3) Certain alleged discrepancies, inaccuracies, and inconsistencies in the locative descriptions in the trial court's judgment.

Since appellants' first two above contentions involve a construction of the pleadings, they will be considered together. The pleadings are quite voluminous, consuming the major portion of a 950-page record. In large measure they have no important bearing upon the issues which the appeal now presents. We believe the following résumé fairly states their substance in so far as pertinent to our present inquiry:

The suit (trespass to try title) filed January 5, 1929, by the state, sought to recover the mineral title to the second tract. It was also alleged that large quantities of oil had been extracted from the tract, as to which the state sought an accounting and judgment for its value. Appellants, as well as all other parties interested in the property, including royalty owners, were made parties defendant.

June 27, 1929, the state filed its first amended original petition, in which it sued for the fee-simple title to tract No. 1, with the exception of tract No. 2, as to which latter it sued only for the mineral title. It renewed its suit for an accounting and for the value of the extracted oil.

October 7, 1929, the California Company filed its first amended original answer, in which, after pleading specifically its mineral rights and titles under its leases covering sections 34 and 35, it alleged with much particularity, in substance, the following facts:

The boundaries of these sections were not marked by natural objects of any character by which they could be located on the ground, and necessarily they had to be located by reference to known points in distant surveys. The California Company, before commencing exploration and development under its leases, expended large sums of money in endeavoring to ascertain the exact boundaries of these sections; and, in good faith and based upon the best expert advice obtainable, drilled the four wells in question in accordance with the railroad commission's orders, placing them at what it believed to be the requisite distance west of the east line of section 35, which is coincident with the east line of tract No. 2; and also drilled wells similarly situated to the east of that line, in good faith believing that the four wells first mentioned were actually upon section 35, and the wells to the east were actually upon survey 34. It spent large sums in exploration and development, and as a result large quantities of oil had been extracted from these and other wells, an exact accounting as to each had been kept; and to quote from the answer: "Defendant would further show that if the wells drilled by it on what it in good faith believed and supposed was a part of Survey 35, and being wells situated on the land described in plaintiff's petition as 106.55 acres, shall prove in law to be a part of Survey No. 34, and not part of Survey 35, as this defendant in good faith believed then such drilling of such wells as being on Survey 35 and such belief of this defendant that such wells were on or part of Survey 35, and the keeping by defendant of its record of oil produced from said wells as being on and a part of Section 35, arose through and from a mistake of fact on the part of this defendant, and if said wells shall be found to be on or a part of Survey 34, then this defendant owes to the School Fund of the State of Texas, the lawful royalty from said wells, which royalty it holds and now offers to pay to the State of Texas as a part of said School Fund. That owing to a question having arisen of whether these wells were on Survey 35 or were on Survey 34 has necessitated this defendant to impound said royalty money and hold same for the benefit of the party entitled thereto and the royalty owners of 34 and the royalty owners of 35 were promptly so notified and advised by defendant."

No specific prayer for relief was made against appellants; but it prayed that it be quieted in its title to its leases as against the plaintiff, and Fred Turner and other interveners.

October 7, 1929, appellants filed a second amended original answer, from...