Great Western Oil Co. v. Carpenter

• Decision Date: 15 May 1906
• Citation: 95 S.W. 57
• Court: Texas Court of Appeals
• Parties: GREAT WESTERN OIL CO. v. CARPENTER et al.

95 S.W. 57

GREAT WESTERN OIL CO. v. CARPENTER et al.

Court of Civil Appeals of Texas.

May 15, 1906.

Rehearing Denied June 14, 1906.

Appeal from District Court, Harris County; Norman G. Kittrell, Judge.

Action by the Great Western Oil Company against Frank H. Carpenter and others. From a judgment in favor of defendants, plaintiff appeals. Reversed, and rendered in part.

Clay S. Briggs and S. S. Hanscom, for appellant. A. L. Davis, for appellees.

REESE, J.

This suit was instituted by the Great Western Oil Company against F. H. Carpenter and his wife, M. A. Carpenter, for the recovery of $1,000 in money, and also for the recovery of a certain tract of 2.82 acres of land. Plaintiff prayed in the alternative that if it was held not to be entitled to recover the money and land, that it be reinstated in its rights under a certain oil lease which had been canceled by agreement of the parties in consideration of the promise of defendants to pay the money and convey the tract of land sued for. Upon trial without a jury there was a judgment for defendants, from which plaintiff appeals.

The material facts are as follows: On January 28, 1901, defendants and one W. N. Fritter executed two certain contracts or agreements substantially identical in their terms, except as to the land covered thereby, one contract embracing 400 acres of land in Jefferson county, and the other 145 acres in Hardin county. By the terms of the contracts, in consideration of $1 recited as having been received by defendants, and the covenants on the part of Fritter therein contained, defendants leased to Fritter for the term of 10 years, unless sooner terminated under the terms of the contract, the aforesaid tracts of land "for the purpose of boring, mining, and operating for oil, gas, coal, and other minerals on said land." The contracts contained the usual stipulations for the exclusive right of Fritter to mine and bore for oil, gas, coal, and other minerals, and for the delivery to the lessors of a specific proportion of the product of such operations, it successful, with power in the lessee to transfer or sublease, and, at his option, to renew the lease for 10 years or so long as the land produces oil, gas, coal, or other minerals, if any ever found. Each of these lease contracts contains the following clause: "The party of the second part hereby agrees to sink one or more wells on said land within 18 months from date hereof, work on the first one of which shall be commenced within six months from the date hereof. In the event of failure to so commence work on said well within six months from date hereof, the parties of the first part may, at their option, cancel this lease, unless the same be renewed for one year by the party of the second part by the payment of the annual rental of 10 cents per acre." Both of these contracts were afterwards assigned by Fritter to the Great Western Oil Company, appellant herein, who became thereby vested with all of the rights and bound by all of the obligations of Fritter. On July 20, 1901, which was eight days before the expiration of the six months within which the lessee was to commence work on the wells to be bored under the contract under the clause therein, above quoted, appellant and appellees entered into a new agreement or contract whereby, in consideration of $1 acknowledged to have been received by appellees, and the further consideration of the stipulations of the contract, appellees granted and sold to appellant for a continuous period of 50 years with privilege of renewal for an equal term "all of the oil, gas, coal, and other minerals under and upon the 400-acre tract covered by one of the first leases aforesaid and 120 acres of the 145 acres covered by the other of said leases, with the usual provisions for right of ingress and egress and occupancy for drilling, mining, and operating for oil, coal, gas, and other minerals, the erection of machinery, laying pipe lines, etc., and stipulations for the payment to appellees of a certain proportion of the output of such operations. In consideration of the execution of this contract appellant released all of the land covered by the two leases executed to Fritter and assigned to appellant from said leases, and expressly released therefrom the 25 acres embraced in said lease of 145 acres and not embraced in the last contract. This contract contained the following clause: "In the event work on a well sinking pipe either for oil or gas is not begun within nine (9) months from date hereof and completed within fifteen months thereafter on each of said two tracts of land, and not abandoned until pipe is down at least 800 feet, unless oil is found at a less depth, then this grant and lease shall become null and void as to both parties of the first and second parts hereto.

On March 24, 1902, the parties entered into another contract, which is as follows: "The agreement this day made between F. H. Carpenter and R. L. Heflin for himself and the Great Western Oil Company is as follows: In consideration of the cancellation by the Great Western Oil Company of its lease on section 34 of the T. & N. O. R. R. Co. survey in Jefferson county, Texas, and on one hundred and twenty acres, more or less, in the Jackson league in Hardin county, Texas, which two tracts of land are more fully described in an instrument of writing between said Carpenter and the Great Western Oil Company, dated the 20th day of July, 1901, the said Carpenter agrees to pay to the Great Western Oil Company the sum of one thousand dollars out of the first money realized from the sale of 50 acres of said land, and further agrees to deed lot No. one to said company or its assigns. Said lot being situated in the northeast corner of said 120-acre tract and measuring 301 feet from east to west by 409 1/3 feet from north to south, and agrees to place the balance of said 120-acre tract in the hands of A. E. Bush and R. L. Heflin for sale for his, Carpenter's account, at such price per lot or per acre as he, the said Carpenter, may from time to time designate, paying them five per cent. commission on sales as made. The one thousand dollars is to be paid out of the proceeds of the sale of the first fifty acres of said land sold, that is, each of the Fifty acres that is sold is to bear its fiftieth of the one thousand dollars. Said Carpenter reserves the right to withdraw said land from sale at any time after ninety days from date hereof and reserves the right to retain the ownership of any one to five lots of said land." This instrument was signed by the Great Western Oil Company and by F. H. Carpenter, but not by M. A. Carpenter, his wife, who signed all of the other contracts hereinbefore referred to. The omission of Mrs. Carpenter to sign, however, is not material. On March 26, 1902, appellant executed to appellee F. H. Carpenter an express release of all of its rights, title, claim, or interest by virtue of the instrument of July 20, 1902. At the date of the contract of March 24, 1902, there remained 26 days of the nine months within which, under the terms of the contract of July 20, 1901, work on a well had to be begun on each of the two tracts of land embraced therein, in default of which the contract was to become void as to both parties.

The trial court found, upon sufficient evidence, that no part of the 50 acres of land referred to in the last contract had ever been sold, and that therefore the basis for the payment of the $1,000 had never been...