George v. Jones, 34455

• Decision Date: 13 March 1959
• Docket Number: No. 34455,34455
• Citation: 168 Neb. 149,95 N.W.2d 609,76 A.L.R.2d 710
• Parties: , 76 A.L.R.2d 710 Chrystal GEORGE and Felice George, Appellees, v. Ardith JONES; Ardith Jones, as Administratrix of the Estate of Harry E. Jones, Deceased, et al., Appellants.
• Court: Nebraska Supreme Court

Page 609

95 N.W.2d 609

168 Neb. 149, 76 A.L.R.2d 710

Chrystal GEORGE and Felice George, Appellees, v. Ardith JONES; Ardith Jones, as Administratrix of the Estate of Harry E. Jones, Deceased, et al., Appellants.

No. 34455.

Supreme Court of Nebraska.

March 13, 1959.

Syllabus by the Court

1. Where the only consideration for the lease of a gravel pit for a long period of years was a royalty on the gravel removed, and the lease contained no express provision for a continuous operation or for forfeiture for failure to develop and operate the pit, there was an implied covenant on the part of the lessee to develop and operate the pit with reasonable diligence.

2. Where a lessee covenants expressly to pay the lessor a certain royalty for all the gravel removed from a gravel pit under a mining lease, even though there be no express covenant that the lessee shall work the gravel pit continuously, or in any particular way, or at all, there is manifestly an implied covenant on his part that he will work it as such gravel pits are usually worked, with ordinary diligence, under the surrounding circumstances.

3. When an action in equity is appealed, it is the duty of this court to try the issues de novo and to reach an independent conclusion without reference to the findings to the district court. But in a case wherein the court has made a personal examination of the physical facts, and where, in the same case, the oral evidence in respect of material issues is so conflicting that it cannot be reconciled, this court will consider the fact that such examination was made and that such court observed the witnesses and their manner of testifying, and must have accepted one version of the facts rather than the opposite.

Nate C. Holman, Emory P. Burnett, Lincoln, John R. Brogan, York, for appellants.

Perry & Ginsburg, York, for appellants.

Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE and BOSLAUGH, JJ.

MESSMORE, Justice.

This is an action in equity brought in the district court for York County by Chrystal George and Felice George, plaintiffs, against Ardith Jones as the surviving widow of Harry Jones, deceased, and as administratrix of his estate, the heirs at law of Harry Jones, deceased, and one Adolph Hromas, defendants. The purpose of the action was for a forfeiture and cancellation of a mineral lease and to quiet title of all mineral rights in certain land in the plaintiffs. The trial court found generally in favor of the plaintiffs and against the defendants; that the lease set forth and described in the plaintiffs' petition had been forfeited and that plaintiffs were entitled to a cancellation thereof; and that the title and right of possession in the real estate involved should be quieted and confirmed in the plaintiffs. The trial court ordered the defendants to immediately remove from said premises their gravel stock piles and all structures, machinery, and equipment belonging to the defendants. The defendants filed a motion for new trial. Upon the overruling of the motion for new trial, the defendants appealed.

The record shows that Ardith Jones is the surviving widow of Harry Jones, deceased, and administratrix of his estate; that Gale D. Jones, Irene Jones Nelson, and Ivan W. Jones are adults and heirs at law of Harry Jones, deceased; that James Vance Jones, Sandra Jones, Thomas Jones, and Samuel Jones are minor heirs at law of Harry Jones, deceased; that a guardian ad litem was appointed by the court to represent the interests of the minors; and that Adolph Hromas, a defendant, was a person to whom Ardith Jones, administratrix of the estate of Harry Jones, deceased, granted certain rights to remove gravel under a lease which will hereinafter the described.

There appears in evidence a gravel lease which was entered into in February 1956, by and between Chrystal George and Felice George as lessors, and Harry Jones as lessee. Insofar as need be considered in the instant case, the lessors leased to the lessee the following described real estate: The southeast quarter of Section 12, Township 9 North, Range 2 West of the 6th P.M., in York County, for the sole purpose and with the exclusive right to excavate and remove gravel to any extent lessee might desire. Lessee was given the right of ingress and egress over a selected route for hauling gravel from said premises, and was also granted the right to construct and maintain any machinery, buildings, or equipment that might be required by him for the excavation, storage, or removal of gravel. This lease was granted to the lessee for a term of 5 years from March 1, 1956, and was to expire on March 1, 1961. The lessee agreed to pay as rental the sum of 10 cents for each cubic yard of gravel removed from the premises by the lessee, such rental being payable monthly during the term of the lease, commencing on April 1, 1956, and on the first day of each month thereafter. The provisions of this lease were binding on the parties thereto, their executors, administrators, heirs, and assigns.

The plaintiffs' petition alleged the ownership in them of the premises heretofore described; the interests of the respective defendants relating to the gravel lease and their relation to the lessee; and the entering into of the lease. It further alleged that since the death of Harry Jones, the lessee under the lease, the defendants had taken over and assumed the lease but had failed to use any diligence whatever in mining or extracting gravel from the premises, and failed to make reasonable effort to extract gravel from said premises; that for the entire period since the date of the death of Harry Jones the defendants, although repeatedly warned by the plaintiffs of their obligations in this respect, had failed and refused to continue the efforts to mine and remove gravel from the premises; and that by reason of the failure of the defendants to work and operate under the lease with reasonable diligence, the lease became forfeited and plaintiffs were entitled to cancellation of the same. The plaintiffs prayed for a determination of their rights under the lease, including a determination that the lease was forfeited and that title to the real estate be quieted in the plaintiffs; that defendants be required to remove their personal property therefrom; and for general equitable relief.

The defendants, by answer, admitted the ownership of the real estate described in the plaintiffs' petition to be in the plaintiffs, but denied that plaintiffs were entitled to immediate possession thereof; admitted the execution of the gravel lease and the assumption of it by defendants according to its terms, and that certain machinery located on the leased property belonged to the defendants; but otherwise generally denied the allegations of the petition.

The defendants' answer affirmatively alleged that defendants had sought to operate the lease diligently since the death of Harry Jones, the lessee under the lease; that certain royalty payments had been made under the lease and further payments refused by plaintiffs; that there had been difficulty in keeping the machinery in repair, which fact was made known to the plaintiff Chrystal George who agreed that any delay because of such difficulty would not place defendants in default under the lease; and that operations had been continued and royalties tendered pursuant to the lease. The prayer of the answer was for dismissal of the plaintiffs' petition at plaintiffs' costs.

The plaintiffs' reply was a general denial of the allegations of the answer, except such as admitted allegations of the petition.

The answer of the guardian ad litem to the plaintiffs' petition was a general denial.

The defendants assign as error that the finding of the trial court for the plaintiffs was based on insufficient evidence; that the trial court erred in rendering judgment for a forfeiture of the gravel lease; and that the trial court erred in overruling the defendants' motion for new trial.

Elmer George testified that Chrystal George is his wife and Felice George is his daughter; that they are the owners and lessors of the gravel lease, wherein Harry Jones is designated as the lessee, of the property heretofore described; that he looked after the interests of his wife and daughter in this property and had business dealings with Harry Jones during his lifetime while Harry Jones was operating the gravel pit under the lease; and that the only consideration for the lease was the payment of royalties of 10 cents for each cubic yard of gravel taken from the property by the lessee. This witness then detailed the amount of royalty payments received from the date of the start of the lease, which was March 1, 1956, to January 1957.

Harry Jones died on July 13, 1956. Gale Jones took over the operation of the lease the latter part of June 1956 and operated it until about a week or so in January 1957.

Elmer George further testified that the royalty for March 1956 was $108.50, based on the production of 1,080 cubic yards. It might be stated at this point that the amount of royalty is based on the number of cubic yards. For instance, $108.50 would be for 1,085 cubic yards. Hereafter we will not use the figure of cubic yards. In April 1956 the royalty was $147.50; in May, $107.50; in June, $65.50; in July, $188; in August, $337; in September, $281; in October, $162.30; and in November, $80.50. On January 16, 1957, there was a royalty of $22.50, which constituted the pumping by Gale Jones for the month of December. This lack of production was due to cold weather, the gravel pit being frozen so that pumping could not be done. There was a small royalty in January 1957, of $6.40. That was when Gale Jones terminated his operation of the gravel pit. Thereafter, in March 1957, Adolph Hromas started to operate the gravel pit. The royalty for March 1957 was $6; for April, $8; for May, $8; for June, $11.75; for July, $10.50; and for August, $31.50. The...