Federal Gas, Oil & Coal Co. v. Moore

• Citation: 161 S.W.2d 46,290 Ky. 284
• Parties: FEDERAL GAS, OIL & COAL CO. et al. v. MOORE et al.
• Decision Date: 14 February 1941
• Court: Court of Appeals of Kentucky

161 S.W.2d 46

290 Ky. 284

FEDERAL GAS, OIL & COAL CO. et al. v. MOORE et al.

Court of Appeals of Kentucky

February 14, 1941

Rehearing Denied May 8, 1942.

Appeal from Circuit Court, Martin County; J. F. Bailey, Judge.

Action by Albert Moore and others against the Federal Gas, Oil &amp Coal Company and others, to quiet title to minerals under certain lands. Judgment for plaintiffs, and defendants appeal.

Reversed.

Buford C. Tynes, of Huntington, W. Va., Ira M. Nickell, of Ashland and Z. Wells, of Paintsville, for appellants.

John T Diederich and John Stanley, both of Ashland, and W. R. McCoy, of Inez, for appellees.

SIMS Commissioner.

On April 29, 1889, Samuel Moore, Sr., and wife executed and delivered to Henry R. Phillips, trustee, a deed conveying the minerals in certain lands located in Martin County the pertinent parts of which read: "The said party of the first part do hereby grant, sell and convey with general warranty to the said party of the second part all the coal salt-water and minerals in and upon and under my farm or tract of land containing 802 acres" (here follows description). "With the right of the said Henry R. Phillips, his heirs and assigns of entry to mine the said coal and salt-water with all the usual mining privileges, reserving to myself fee simple to the surface of my said land and the right to mine coal thereon for my own household use and my heirs so long as I or they occupy the premises."

This deed further provides that if within twenty years the grantee shall elect to take certain designated 10 acres of the surface at the price of $15 per acre, upon the tender of this sum and "filing such written designation with the Clerk of the Martin County Court an absolute fee simple title to so much land and premises as is thus designated shall thereupon vest in him without further conveyance ***."

On December 22, 1886, Samuel Moore, Sr., executed to F. Prentice an oil and gas lease on 700 acres of land in Martin County, which land is not identified particularly in this record. This lease was for a term of thirty years and provided for the drilling of a well in the "Martin District" within one year or the payment of a rental equal to the taxes on the land. None of the conveyances in this record executed by Moore from 1886 to 1891 refer directly to this lease.

On July 24, 1891, Moore conveyed 100 acres of the 802-acre tract to his son, Albert, and on the same date conveyed 151 acres of same to his son. Lincoln, and the latter on November 28, 1910, conveyed this 151 acres to Albert. All three of these conveyances contained this clause, or one very similar to it: "the mineral rights have heretofore been sold and are excepted". Albert executed an oil and gas lease on these two tracts aggregating 251 acres (designated in the lease as 260 acres) to John T. Diederich, trustee, on June 4, 1930. Diederich refused to accept this lease from Albert until he had read the Moore Phillips deed and examined the records in the county court clerk's office relative to other deeds taken by Phillips about the year 1889. Concluding that Albert had title to the oil and gas under this 251 acres, Diederich accepted the lease and assigned it to the D. B. & M. Oil & Gas Company.

In 1931, Diederich, Albert and the D. B. & M. Oil and Gas Company instituted this action to quiet title against the Federal Gas, Oil & Coal Company, Warfield Natural Gas Company and Virginian Gasoline & Oil Company, all of which claimed title to the minerals under this land by mesne conveyances from Phillips, trustee. The petition alleges that Samuel Moore, Sr., and Phillips did not know oil and gas existed under this land in 1889 when he conveyed the minerals to Phillips, and as they did not contemplate a conveyance of the oil and gas, such were not included in the term "minerals". By an amendment this part of the petition was withdrawn, and it was alleged that oil and gas were included in the draft of the original deed submitted to Samuel Moore, but he refused to sign same until the words "oil and gas" were struck therefrom; that these words were struck from the deed and were not in it when Samuel Moore, Sr., signed and it was not the intention of the parties to, and they did not, include oil and gas in the minerals conveyed to Phillips.

Defendants filed a general demurrer to the petition as amended which was overruled. Thereupon answer was filed traversing the plaintiffs' pleadings, followed by an affirmative plea of the statutes of limitations, and of champerty. Much proof was taken, and upon the case being submitted to the chancellor, he adjudged the plaintiffs to be the owners of the oil and gas in the 260 acres described in their petition, and defendants appeal. The plaintiffs offered no competent proof that Samuel Moore, Sr., required the words "oil and gas" to be stricken from the deed before he executed it to Phillips in 1889, and the question for determination is whether or not the word "minerals" as used in that deed included oil and gas.

"The rule followed in this and practically all other jurisdictions is that a grant or exception of 'minerals' in a deed includes all mineral substances which can be taken from the land unless restrictive language is used indicating that the parties contemplated something less general than all substances legally cognizable as minerals". Maynard v. McHenry, 271 Ky. 642, 113 S.W.2d 13, 14; Kentucky Diamond Mining & Developing Co. v. Kentucky Transvaal Diamond Co., 141 Ky. 97, 132 S.W. 397, Ann. Cas. 1912C, 417; Waugh v. Thompson Land & Coal Co., 103 W.Va. 567, 137 S.E. 895. The word "minerals" in a grant or exception includes oil and gas unless the language of the deed discloses an intention to exclude them. Maynard v. McHenry, supra; Kentucky West Virginia Gas Co., v. Preece, 260 Ky. 601, 86 S.W.2d 163; Scott v. Laws, 185 Ky. 440, 215 S.W. 81, 13 A.L.R. 369. It is only where the language of a grant or exception is ambiguous that extrinsic evidence is admissible, and if there are no restrictive words, a conveyance or exception of...