Drake. v. O'Brien

• Decision Date: 25 March 1919
• Docket Number: No. 3630.,3630.
• Citation: 83 W.Va. 678
• Parties: Cornelia M. Drake et al. v. Anna M. O'Brien, Admx. et al.
• Court: West Virginia Supreme Court

83 W.Va. 678

Cornelia M. Drake et al.

v.Anna M. O'Brien, Admx. et al.

No. 3630.

Supreme Court of Appeals of West Virginia.

Submitted March 12, 1919.

Decided March 25, 1919.

1. Appeal and Error Orders Appealable Decree.

A decree on a bill filed by plaintiffs who, prima facie, are tenants in common with some of the defendants, charging deeds from those under whom they claim to persons under whom such defendants claim, purporting to be absolute conveyances of undivided interests, to have been in fact mortgages, and seeking redemption or reconveyances and an accounting for rents and profits, which adjudicates the conveyances to have been absolute, sustains demurrers to the bill, without dismissal, and grants leave to show grounds for an accounting, by amendment of the bill, is not appealable, because it does not settle all of the principles of the cause. (p. 682).

2. Mortgages Deed as Mortgage Bill Laches.

A bill to have a deed absolute on its face adjudged to be in fact a mortgage, fded by descendants and successors of the grantors, more than thirty years after payment of the alleged mortgage debt and after the deaths of all the parties thereto, the plaintiffs and their ancestors having been out of possession of the property during all of such period and silent as to the character of the deed, and the question of its true character being dependent largely upon oral evidence, is barred by laches. (p. 683).

3. Tenancy in Common Power to Lease.

A tenant in common of oil producing property, having authority from his cotenant to lease it for oil production, without limitation except as to the amount of the royalties to be reserved, conferred upon him by the deed of his cotenant, conveying to him his interest in the land, may make a valid parol lease thereof for such purpose, within the limitations prescribed by law. (p. 685).

4. Same Parol Lease Presumption.

One who has been in possession of the property under such authority and conducting operations thereon for many years and accounting for the royalties to the owners, is presumed, in the absence of evidence of a lease by deed, to be a parol lessee, or such status is legally inferable from the facts and circumstances, (p. 685).

5. Landlord and Tenant Parol Lease Tenancy from Year to Year.

Though such a lease is not valid as one for a term of more than five years, by reason of the inhibition of the statute of frauds, it together with possession thereunder and payment of the royalties, for many years, creates at least a valid tenancy from year to year, terminable, if at all, only by statutory notice and barring any relief by injunction and receivership, until extinguished in some way. (p. 688).

6. Judgment Conformity to Prayer.

Though the pleadings and evidence in a cause having for its purposes those above indicated may show grounds for partition of the land, in some way or to some extent, or a sale thereof in lieu of partition in kind, it is not error to fail to award it by a decree settling the principles of the cause, in the absence of a specific prayer therefor, nor does such failure deny right of appeal from the decree. (p. 688).

Appeal from Circuit Court, Wood County.

Action by Cornelia M. Drake and others against Anna M. O'Brien, administratrix, etc., and others, and P. D. Neal, executor, etc. Decree for plaintiffs and certain defendants appeal.

Reversed in part. Affirmed in part. Remanded.

W. H. Wolfe and V. B. Archer, for appellants.

Wm. Beard and W. E. Sikes, for appellees Drake and others.

Reese Blizzard, for appellee Neal.

Poffenbarger, Judge:

This appeal seeks review of three decrees entered, respectively, March 19, 1914, April 6, 1917, and March 28, 1918. The last one awarding the plaintiffs a right of accounting for oil, coal and timber taken from a tract of land containing about 1, 000 acres, throughout a period of more than thirty years, upon a basis determined by it, as well as partially by the preceding decrees, may be deemed to have settled the principles of the cause. Whether the first one did is questioned by a cross-assignment of error.

The primary claim of a right to ah accounting depends upon the legal effect of two deeds dated, respectively, June 26, 1875, and April 4, 1877, and purporting to convey undivided interests in said tract, both of which the plaintiffs charge in their bill to have been mortgages. This eonten- tion, as well as the claim to a right to an accounting upon the facts alleged, was rejected by said first decree; but the court, being of the opinion that the plaintiffs might be able to show themselves to be entitled to an accounting, granted them leave to amend their bill. Both plaintiffs and defendants complain of that decree, the former, because it held the deeds to be absolute, and the latter, because it did not preserve their alleged right to operate the entire tract of land for coal, oil, gas and timber, under the terms of the deeds purporting to confer such rights.

The deed of June 26, 1875, executed by Edmund L. Gale and Mary Gale, his wife, to James M. Stephenson, Thompson Leach, W. Vrooman, C. H. Shattuck and H. H. Moss, after reciting the existence of a deed of trust on the lands in question, to secure the payment of ten $5,000.00 notes held by William Cady, payment of four of them, default as to one and partial default as to another, making past-due indebtedness of $8,146.56, conveyed to the parties of the second part an undivided one-half interest in and to at least one thousand acres of a tract containing about 2, 000 acres, situated in Wood and Ritchie Counties, for and in consideration of said sum. of $8,146.56 and covenants therein contained, authorizing the grantees to take immediate and exclusive control of said 1, 000 acres and all personal property thereon and operate the same as to them should seem best; to collect all rents and profits then due or thereafter to become due to the parties of the first part; to cut timber from said land or mine for coal, oil, salt or other mineral products; all to the end that the grantees might make as much money as possible out of the land and pay out of the rents and profits, (1) all necessary expenses of operation; (2) themselves the $8,146.56 paid by them to Cady; and (3) the remaining notes held by Cady. They bound themselves to pay the Cady debt out of the rents and profits, if sufficient, but not otherwise. But their right to operate the entire tract was not to terminate with reimbursement for their out-lay and payment of the Cady debt. It was to continue indefinitely and the net proceeds or profits of operation were to be divided equally between them and the grantors. The deed expressly provided that they should continue to have the entire and exclusive control of the entire 1, 000 acres, and to work and manage it for any purpose and in any manner they should see fit; and gave them sole and exclusive right to grant leases on the land for mining coal, oil and other minerals, or for cutting timber; provided that no leases should be granted for a royalty less than one-fourth of the production, nor any existing royalties reduced below one-fourth without the consent of the grantors. Gale was then the owner of oil wells on the tract and he was required to pay a one-fourth royalty out of the production of his wells.

By the deed of April 4, 1877, the same grantors conveyed to the same grantees an additional undivided one-eighth of the same tract of land, for and in consideration of $5,000.00, and a re-affirmation of the grant made to them by the former deed and all of the covenants and provisions thereof. This deed expressly stipulated that, after full payment of the Cady debt, the grantees were to account to the grantors for only three-eights of the net income from the property. By a deed dated, Sept. 24, 1877, the Gales conveyed to George Loomis an undivided one-thirty-second of the tract, in consideration of the sum of $1,250.00. This deed recited the two former deeds and stipulated that Loomis should hold the interest conveyed to him in the same manner to all intents and purposes, as the grantees in said deeds held theirs.

The grantees in the first two deeds, holding twenty-thirtyseconds of the land and operating it for oil, conducted the business under the name and style of the Wood County Petroleum Company. The Cady debt was paid off and his deed of trust released, Dec. 12, 1877, and thereafter, the Wood County Petroleum Company received from the operations one-fourth of the gross production from the oil wells and paid to the Gales and others their pro rata shares of such one-fourth, as and for their shares of the net profits. Mary Gale, the original owner of the tract, died many years ago. She, until her death, and those deriving their interests from her, after her death, accepted the payments so made, without objection or complaint, until a comparatively short time before the institution of this suit in 1913. The uniform prac- tice of the Wood County Petroleum Company was to make a distribution of the royalties received, when and as often as they amounted to $1,200.00 or more. When the land was taken over by it, the operations were conducted by strangers to the deeds, under leases yielding one-fourth royalties, except in the case of the Gale wells which paid an equivalent share of the production, under provisions of the deeds. But the manner of conducting the business underwent a change about the year 1890, when Shattuck sold and conveyed his interest to one Dennis O'Brien who had, since 1885, acted as the agent of the Wood County Petroleum Company, in charge of the property. At or before that time, some of the leases had been abandoned and O'Brien took charge of the wells on them and operated them himself, without having taken leases on the territory. He paid one-fourth of the production to the Wood County Petroleum Company of which he was a member. Gradually other leases were abandoned by their owners or bought out by him, and he finally became the sole...