Greif Bros. Cooperage Corp. v. United States Gypsum Co.

• Decision Date: 23 February 1965
• Docket Number: No. 17569,17570.,17569
• Parties: GREIF BROS. COOPERAGE CORPORATION, a Delaware Corporation, Appellant, v. UNITED STATES GYPSUM COMPANY, an Illinois Corporation, Appellee. UNITED STATES GYPSUM COMPANY, an Illinois Corporation, Appellant, v. GREIF BROS. COOPERAGE CORPORATION, a Delaware Corporation, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

341 F.2d 167 (1965)

GREIF BROS. COOPERAGE CORPORATION, a Delaware Corporation, Appellant, v. UNITED STATES GYPSUM COMPANY, an Illinois Corporation, Appellee.

UNITED STATES GYPSUM COMPANY, an Illinois Corporation, Appellant, v. GREIF BROS. COOPERAGE CORPORATION, a Delaware Corporation, Appellee.

Nos. 17569, 17570.

United States Court of Appeals Eighth Circuit.

February 9, 1965.

Rehearing Denied February 23, 1965.

COPYRIGHT MATERIAL OMITTED

W. H. Daggett, of Daggett & Daggett, Marianna, Ark., for Greif Bros. Cooperage Corp.

George K. Cracraft, Jr., Helena, Ark., for United States Gypsum Co.

Before VAN OOSTERHOUT, BLACKMUN and MEHAFFY, Circuit Judges.

MEHAFFY, Circuit Judge.

United States Gypsum Company brought this action against the Greif Bros. Cooperage Corporation in the United States District Court for the Eastern District of Arkansas to quiet title to separate tracts of land in Desha County, Arkansas and for damage by trespass for the removal of timber from one of the tracts.

The two, noncontiguous tracts of land in dispute are located near the bank of the Mississippi River in areas designated by the last Government Survey of 1846 as Sections Twenty-Two (22) and Twenty-Three (23), Township Eleven South (T 11 S), Range One West (R 1 W), respectively.

The District Court found for Greif Bros. as to the tract in Section 22 and for Gypsum as to the tract in Section 23. Each party has appealed from that part of the decree adverse to it.

Jurisdiction is established by diversity of citizenship and the amount involved.

Because the legal issues differ with respect to each tract, we will separately discuss the parties' adverse claims of ownership.

SECTION 23 TRACT

The Government Survey of 1846 shows that most of the north half of Section 23 and the fractional northeast corner of the southwest quarter of Section 23 were originally underwater and formed a part of a bed of a meandered lake, known as Long Lake. All of the disputed tract in Section 23 became land in place by the processes of accretion and reliction when the lake's waters completely receded many years prior to 1939. The particular area in controversy may be termed as the proportional division of the accretions riparian to the southwest quarter, extending northeasterly into the north half of Section 23.

In 1951, Gypsum by a single conveyance from one Lulu B. Zellner obtained numerous tracts of land in several different sections. This grant included a warranty deed to the "Frl. NW¼ of Section 23" and a quitclaim deed to the "NE¼ of Section 23."

Lulu B. Zellner, Gypsum's grantor, derived her chain of title to these lands by a will from her husband, A. C. Zellner, who died on July 29, 1944, and by conveyances thereafter from the remaining heirs of the original owner, B. O. Zellner, who had died intestate on June 1, 1922. Mrs. Zellner acquired the last of these conveyances vesting in her fee simple title to the lands of the B. O. Zellner Estate on August 29, 1945.

Greif Bros. by warranty deed dated August 16, 1940 acquired title to the "Fractional Southwest Quarter (SW¼) of Section Twenty-Three (23), * * * together will all accretions, relictions, and additions, thereto belonging" from its grantor, Arkamiss Timber Co.¹

In the trial of the instant case to the court below, the District Judge admitted into evidence certain records, a map, and correspondence from the files of deceased Desha County Surveyor, Ike Bankston. These exhibits indicated that Mrs. Zellner in December of 1947 had employed Bankston to perform a joint survey with a surveyor of Greif Bros. to establish the boundaries of her lands, some years subsequent to a 1940 conveyance by herself and her husband on behalf of the heirs of B. O. Zellner to Greif Bros.

Following an appraisal of the findings of this survey, Mrs. Zellner informed Bankston by letter that although she knew the 1940 deed did not convey to Greif Bros. any part of Section 23, "I know they own the SW¼ of Section 23." However, she was unwilling to accept those boundaries in Bankston's map which illustrated the accretions to the SW¼ of Section 23 extending into the N½ as belonging to Greif Bros. Bankston's written reply insisted that Greif Bros. obtained ownership of a proportionate share of the accretions from Long Lake riparian to its SW¼ of Section 23 under Arkansas law.

Greif Bros.' argument is that having acquired ownership of the disputed accretions as the riparian landowner, it maintained entitlement thereto by the timely payment of taxes on the riparian land assessed as the "Frl. SW¼ & Accr., Sec. 23" since 1942. It contends these payments prevented any divestment of title by Gypsum for payment of taxes on the same land by itself and its predecessors in title for fifteen years pursuant to a different assessment and description under Ark.Stats.Ann. §§ 37-102, 37-103. Greif Bros. also maintained that the Bankston exhibits would estop Mrs. Zellner, and likewise her successor in title, Gypsum, from claiming any of the accretions shown to be riparian to lands concededly not owned.

While, on the other hand, Gypsum urged in support of its claim of title that it had paid taxes on this unsurveyed tract of land formed by accretion and reliction according to the only valid tax description, "NW¼ Section 23 and NE¼ Section 23," which is based on an extension of the existing lines of the Government Survey of 1846.

The District Court found as fact that:

(1) All of the area in Section 23 was shown as the bed of a meandered lake and platted as such on the General Land Office Plat of Survey on December 23, 1846;

(2) By recession of the water in the lake, the area in controversy arose from the bed of the lake and by such processes of accretion and reliction and the gradual recession of the water became land in place many years prior to 1939;

(3) All of said controversial area was from the time it arose from the lake bed and continued to be wild, unimproved, unenclosed and unoccupied timber land;

(4) At least since 1936 the area in controversy had been separately assessed for taxation by county officials under descriptions Frl. Northwest Quarter (NW¼) Section Twenty-Three (23) and Northeast Quarter (NE¼) Section Twenty-Three (23);

(5) The area in controversy would be properly described if the lines of the public survey be extended as lying within the Northwest Quarter of Section 23 and the Northeast Quarter of Section 23; and

(6) Gypsum and its predecessor in title paid taxes on this description in unbroken sequence for the years 1945 to 1959, inclusive.

The District Court concluded that Gypsum was invested with title by operation of the aforecited Arkansas statutes which make payment of taxes under color of title equivalent to adverse possession.²

Our duty as a federal appellate tribunal when asked to review a matter of local state law in a diversity case is limited to determining whether or not the District Court in its findings made permissible interpretations of the applicable state law. James Talcott, Inc. v. Associates Discount Corp., 302 F.2d 443, 449 (8th Cir. 1962); Anderson-Tully Co. v. Chicago Mill & Lumber Co., 175 F.2d 735, 736 (8th Cir. 1949); Anderson-Tully Co. v. Murphree, 153 F.2d 874, 877 (8th Cir. 1946).

We have previously recognized that under Arkansas law for a claimant to prevail in an action to quiet title, he must prove and rely wholly upon the superior strength of his chain of title and cannot depend his recovery upon a showing of a defect or weakness in the title of an adversary. Bryant v. Chicago Mill & Lumber Co., 216 F.2d 727 (8th Cir. 1954); Anderson-Tully Co. v. Murphree, supra. The valid acquisition by Greif Bros. of title to land described as "SW¼ of Section 23, together with all accretions and relictions" would without question convey ownership to both existent as well as subsequently formed alluvion riparian to the original grant. Wyatt v. Wycough, 232 Ark. 760, 341 S.W.2d 18 (1961); Crow v. Johnston, 209 Ark. 1053, 194 S.W.2d 193 (1946); State v. Harper, 161 Ark. 666, 256 S.W. 78 (1923). As an adjunctive right of riparian ownership, ordinarily the payment of taxes by Greif Bros. pursuant to the assessment and description of the original tract of land designated on the tax records as "Frl. SW¼ & Accr. Sec. 23" would constitute payment on the disputed accretions provided the riparian rights had not been severed by separate conveyances or assessment. Bryant v. Chicago Mill & Lumber Co., 120 F.Supp. 463, 467 (E.D.Ark.1954), aff'd 216 F.2d 727 (8th Cir. 1954).

Gypsum proved to the satisfaction of the District Court that the disputed accretions in the North Half of Section 23 were severed from the riparian Southwest Quarter by a valid, separate tax assessment. The District Court was also satisfied that the taxes were paid pursuant to this assessment for the period required to avail Gypsum of the benefits of the adverse possession statutes.

Ark.Stat.Ann. § 37-102 provides that payment of taxes on wild, unimproved and unenclosed land for seven consecutive years under color of title shall be considered as actual possession for such period. Ark.Stat.Ann. § 37-103 states that payment of taxes on such lands for a period of fifteen consecutive years shall create a presumption of law that the taxpayer or his predecessor in title held color of title prior to the first payment. We are aware that when the terms of these statutes have been met, they operate affirmatively to vest title in the taxpayer. Bryant v. Chicago Mill & Lumber Co., supra, 216 F.2d at 734.

However, Greif Bros. also paid taxes on the riparian land pursuant to the tax description "SW¼ & Accr. Sec. 23" preceding and during the same fifteen years of payment by Gypsum and its predecessor in title. Thus, the critical determination is whether the tax payments of Gypsum and its predecessor in title under the descriptions "Frl. NW¼ of Section 23" and "NE¼ of Section 23" based on an extension of the public survey lines constituted...