Franklin v. Margay Oil Corp.

• Decision Date: 21 November 1944
• Docket Number: 31861.
• Citation: 153 P.2d 486,194 Okla. 519,1944 OK 316
• Parties: FRANKLIN et al. v. MARGAY OIL CORPORATION et al.
• Court: Oklahoma Supreme Court

153 P.2d 486

194 Okla. 519, 1944 OK 316

FRANKLIN et al. v. MARGAY OIL CORPORATION et al.

No. 31861.

Supreme Court of Oklahoma

November 21, 1944

Syllabus by the Court.

1. An ordinary oil and gas lease conveys an interest in the land covered thereby and the owner of the lease in possession may maintain an action in equity against adverse claimants to quiet his title.

2. In actions in equity in the district court to quiet title to real property the district court has inherent power and jurisdiction, based upon consideration or necessity and expediency, to construe trust provisions of a will as an incident in determining the rights and interests of devisees under such will.

3. Action in equity to quiet title to real property must be brought in the county in which the property is situated and the district court may in such action, incidentally, construe trust provisions of the will in so far as they affect such real property, without regard to whether the trustees under the will reside in such county.

4. A guardian ad litem cannot waive or admit away any substantial right of the infant, or consent to anything which may be detrimental to him, but the guardian ad litem may make a valid consent or waiver as to matters which facilitate a trial which cannot prejudicially affect the rights of the infant. The matter of venue is one which may be waived in a case where it appears that such waiver would be to the interest rather than to the detriment of the infant.

5. Service of summons by publication on nonresident defendants is permissible in all actions in rem.

6. Any person may be permitted to intervene in an action where he has or claims an interest in the controversy and where his substantial rights are in litigation or may be affected.

7. Where permission to intervene is obtained and petition in intervention is filed in a pending action before expiration of the time for answer by defendants, no new process is required where notice and copy of the petition in intervention is served on or accepted by the defendants in the action. Defendants sui juris waive issuance and service of new summons on a petition in intervention by appearance and answer to the petition in intervention.

8. Under a will empowering testamentary trustee to sell and convey all or any part of the real estate comprising the corpus of the trust estate, the trustee is authorized to execute a valid oil and gas lease covering all or any part of the land comprising the trust property.

9. A trust created by the provisions of the will here involved is a valid subsisting trust created in the manner and within the limitations prescribed by statute.

10. Under the provisions of the will quoted in the opinion the various interests created are: (1) fee simple title to the trustees, in trust for the purposes stated in the will, to continue during the life of the survivor of the wife and daughter of the testator, subject to administration in probate; (2) to Ella Stanley Holliday the full primary beneficial interest during her lifetime in and to the fund provided by the trustor to be created by the trustees, with equitable estate in the corpus of the trust; (3) to Vivian Ada Franklin contingent secondary interest in and to such fund during the remainder of her life following the death of Ella Stanley Holliday; the contingency arising out of the possibility that the trust property might properly be entirely disposed of by payment from the fund to Ella Stanley Holliday; also equitable estate in the corpus of the trust (4) to the issue of Vivian Ada Franklin fee simple title in contingent remainder limited and defeasible upon condition subsequent; this being by permissible disposition in whole or in part by the trustees of the corpus of the trust.

11. Under 60 O.S.1941 § 175.53, the terms of the act of which said section is a part are applicable in the construction of an operation under: A. All agreements containing trust provisions entered into subsequent to the effective date of the act of which said section is a part: B. All wills made by testator whose death occurs subsequent to the effective date of said act; C. All other wills and trust agreements and trust relations insofar as such terms do not impair the obligation of a contract or deprive persons of property without due process of law.

12. A legislative act which undertakes or operates so as to reduce the interest of a remainderman in an estate devised to him which has become vested in such remainderman before the enactment of such statute, is not due process of law and violates the Constitution of the State of Oklahoma and of the United States.

Action by Margay Oil Corporation and others against E. V. Dennis and others to determine title to real property, to quiet title and to construe a will and trust, wherein T. R. Benedum was appointed guardian ad litem for the minor defendant Vera Ellen Franklin individually and as representative of the class to which she is a member, and was appointed to appear for and represent the issue of Vivian Ada Franklin, known and unknown, who are or may be minors, and to serve as trustee of whatever interest in the land such issue might have. H. F Westcott intervened as did William M. Franklin, as guardian of the estate of Vera Ellen Franklin. From an adverse judgment and decree, Vera Ellen Franklin, and others, appeal.

Modified and affirmed.

T. R Benedum, of Norman, for plaintiffs in error.

Cantrell, Carey & McCloud and O. A. Cargill, all of Oklahoma City, for defendants in error.

RILEY Justice.

This is an action commenced in the District Court of Cleveland County by Margay Oil Corporation against E. V. Dennis and Ella Stanley Holliday, trustees of the estate of J. R. Holliday, deceased, Ella Stanley Holliday, individually, Vivian Ada Franklin, Prentiss O. Franklin, her husband, Vera Ellen Franklin, a minor, and the unknown and unborn issue of Vivian Ada Franklin. The action is to quiet title to two oil and gas leases and determine the validity, effect, continuity, and duration of said oil and gas leases owned by Margay Oil Corporation covering 54.60 acres of land in Cleveland County, Oklahoma. One of the leases, dated June 8, 1943, was executed by E. V. Dennis and Ella Stanley Holliday as the trustees of the estate of J. R. Holliday, deceased, under a trust created by the will of said J. R. Holliday, to C. C. Guyer and assigned by him to Margay Oil Corporation. The other lease dated the same day, covering the same land to the same lessee, was executed by Vivian Ada Franklin and Ella Stanley Holliday, the daughter and widow, respectively, of J. R. Holliday, deceased. That lease was also assigned to Margay Oil Corporation. Prentiss O. Franklin is the husband of Vivian Ada Franklin. Vera Ellen Franklin is the daughter and only child of Vivian Ada Franklin. The oil and gas leases are the usual Producers 88 form containing the now customary "regulation clause". They run for five years from their date and as long thereafter as oil or gas, or either of them, are produced from the land, and provide the usual and customary 1/8 royalty. The tract of land covered by the lease is: "West 54.60 acres of the Northwest Quarter (NW 1/4) Section 28, Township 10 N., Range 3 W. and containing 54.60 acres, more or less".

J. R. Holliday died testate on or about the 7th day of August, 1941. At the time of his death, he was a resident of Oklahoma County, Oklahoma. His will was duly admitted to probate in said county.

Insofar as is material here, the will provides:

"I hereby give, devise and bequeath all of my property real and personal of every kind and wherever situated, whether vested or contingent at the time of my death unto my executors and trustees, hereinafter named and to their heirs and assigns, forever. In trust, nevertheless, as follows:

I direct that my wife, Ella Stanley Holliday during her lifetime shall have the use of a home, together with the proper furnishings therefor from my estate.

I further will and direct that all the rest, residue and remainder of my property shall be consolidated into a permanent fund to be safely and conservatively invested in bonds secured by mortgage upon real estate, or in such other first-class securities as to my executors and trustees may seem best; and such investments are to be made so as to yield a regular interest and income which shall be paid out, expended, and divided by my said executors and trustees as hereinafter more particularly set forth. I hereby also authorize and empower my said executors and trustees, or the survivor or successor of them to hypothecate, bargain, sell and dispose of any lands, tenements, or property, real or personal, whereof I may be seized at the time of my death, or which they may be possessed as my executors and trustees, and upon any such sale thereof to execute acknowledge and deliver all necessary and proper deeds or instruments of conveyance in the law for the vesting in the purchaser or purchasers the title thereof in fee. And I also authorize and empower my said executors and trustees from time to time, in their discretion, to receive or call for the payment of, and to sell and deliver and to make any necessary assignments or transfers of any and all of the property or securities in or upon which the said money or fund, or any part thereof, shall be invested, and the same again to reinvest or convert into other securities.

I further direct that all the profits, interest and income of the said fund and property, as the same shall be received by my said executors and trustees, after deducting their expenses, commissions and disbursements shall during the life of my wife, Ella Stanley Holliday, be paid by my executors and trustees to my said wife, Ella Stanley Holliday, and I further direct that

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