Hudson & Collins v. McGuire

• Decision Date: 01 June 1920
• Citation: 223 S.W. 1101,188 Ky. 712
• Parties: HUDSON & COLLINS v. MCGUIRE.
• Court: Kentucky Court of Appeals

223 S.W. 1101

188 Ky. 712

HUDSON & COLLINS v. MCGUIRE.

Court of Appeals of Kentucky.

June 1, 1920

Rehearing Denied Sept. 21, 1920.

Appeal from Circuit Court, Lee County.

Suit by Hudson & Collins against C. B. McGuire. From a judgment sustaining a demurrer to the petition, plaintiffs appeal. Reversed, with directions to overrule the demurrer.

Sampson J., dissenting.

W. H Flannery, of Catlettsburg, and Davis M. Howerton, of Ashland for appellants.

H. S McGuire and J. T. Metcalfe, both of Winchester, for appellee.

CARROLL C.J.

In April, 1891, Henry Fraley executed and delivered to W. E. Casto the following deed:

"This deed between Henry Fraley, of Lee county, state of Kentucky, of the first part, and W. E. Casto, of Lee county, Kentucky, of the second part, witnesseth, that the said party of the first part in consideration of seventy-five dollars, the receipt of which is hereby acknowledged, do hereby sell, grant and convey, to the party of the second part, his heirs and assigns, the following described property, viz.: All of the minerals (except stone coal), with necessary right of ways and privileges for prospecting, mining and smelting on my tract of land, lying on the waters of Hell creek, a tributary of the Kentucky river, in Lee county, state of Kentucky. [ Following this is a description of the land.] To have and to hold the same, with all the appurtenances thereon, to the second party, his heirs and assigns forever, with covenant of general warranty."

Fraley and Casto are dead, and this controversy involves the single question whether the deed passed the oil and gas rights and privileges to Casto.

Hudson and Collins, who have a regular title from the heirs of Fraley, assert that the oil and gas rights and privileges were not conveyed by him to Casto, and brought this suit against McGuire, a remote vendee of Casto, who claims that the oil and gas privileges did pass under the deed, to have their alleged title to the oil and gas rights quieted. In their petition they averred:

"That the oil and gas privileges and rights were not conveyed by Henry Fraley, deceased, to W. E. Casto under and by virtue of the Casto deed, and that by reason of the oil and gas rights and privileges not having been conveyed to W. E. Casto in said deed, his heirs and assigns and remote grantees received no interest in said oil and gas rights and privileges, and therefore the defendants are not now the owners thereof. The plaintiffs state that when the said Henry Fraley, deceased, made the conveyance above referred to, to the said W. E. Casto the oil and gas rights and privileges did not pass to Casto under the Casto deed, but were reserved unto the said Henry Fraley, and, at the time of his death descended to his children. They state that at the time Henry Fraley made the conveyance above referred to, to W. E. Casto it was not intended by either Henry Fraley, grantor, or W. E. Casto, grantee, that the oil and gas rights and privileges should be conveyed. At that time it was not contemplated by either of the parties to said deed that oil and gas existed under said tract of land. The only minerals which were in the minds of the grantor and grantee and the only minerals which passed in the said Casto deed were such precious minerals as gold and silver. At that time it was generally believed that Swift's silver mine was located on the Henry Fraley tract of land, and silver alone was intended to be conveyed to said Casto in said deed."

To this petition the lower court sustained a general demurrer, and the plaintiffs have prosecuted this appeal.

It will be seen that the matter in controversy depends on the construction of the clause in the deed, conveying to Casto "all of the minerals (except stone coal) with necessary right of ways and privileges for prospecting, mining and smelting on my tract of land lying on the waters of Hell creek," taken in connection with the averments of the petition, which on this appeal we must assume to be true, "that at the time Henry Fraley made the conveyance above referred to to W. E. Casto, it was not intended by either Henry Fraley, grantor, or W. E. Casto, grantee, that the oil and gas rights and privileges should be conveyed. At that time it was not contemplated by either of the parties to said deed that oil and gas existed under said tract of land. The only minerals which were in the minds of the grantor and grantee and the only minerals which passed in the said Casto deed were such precious minerals as gold and silver. At that time it was generally believed that Swift's silver mine was located on the Henry Fraley tract of land, and silver alone was intended to be conveyed to said Casto in said deed."

On behalf of the plaintiffs, the argument is: First, that the language of this deed, and particularly the clause in controversy, shows on its face that the conveyance was limited to such minerals, excepting stone coal, as might be mined and smelted, and hence did not grant or convey the oil or gas rights or privileges; and, second, that even if it could not be held from an inspection of the deed itself that the grant excluded the oil and gas rights and privileges, the clause in controversy is at least so ambiguous as to make it competent for the plaintiffs to show, if they could, by evidence the situation of the parties at the time the deed was made and the circumstances surrounding its execution for the purpose of establishing that it was only intended by the parties that the deed should convey such minerals as might be mined and smelted and not within their contemplation that the oil and gas rights or privileges should be granted.

On the other hand, it is insisted by counsel for defendant that there is no ambiguity in this clause or reasonable room for difference of opinion as to its meaning or the nature of the minerals it was intended to convey; that as the deed conveyed all the minerals, except stone coal, and the word "minerals" includes oil and gas, extrinsic evidence is not admissible for the purpose of showing what the parties intended should be granted in a controversy between strangers to the original transaction.

It is elementary law that the intention of the parties in the execution of deeds and other like instruments controls the construction, and that when the instrument is fair on its face and free from ambiguity their intention must be gathered from an inspection of the instrument itself without the aid of extrinsic evidence, but if the instrument is so ambiguous as to leave the mind in doubt as to what the parties intended, extrinsic evidence may be resorted to as an aid in the construction of the instrument, although no effort is made to reform it on the ground of fraud or mistake.

As said in 8 R.C.L. p. 1041:

"The tendency of modern decisions is to disregard technicalities and to treat all uncertainties in a conveyance as ambiguities, subject to be cleared up by the resort to the intention of the parties as gathered from the instrument itself, the circumstances attending and leading up to its execution, the subject-matter and the situation of the parties as of that time."

To the same effect is 18 Corpus Juris, p. 279.

In Devlin on Deeds, vol. 2, § 840, the rule is stated thus:

"Again, every provision, clause, and word in the same instrument shall be taken into consideration in ascertaining the meaning of the parties, whether words of grant, of covenant, or description, or words of qualification, restraint, exception, or explanation. Again, every word shall be presumed to have been used for some purpose, and shall be deemed to have some force and effect, if it can have. And, further, although parol evidence is not admissible to prove that the parties intended something different from that which the written language expresses, or which may be the legal inference and conclusion to be drawn from it, yet it is always competent to give in evidence existing circumstances, such as the actual condition and situation of the land, buildings, passages, water courses, and other local objects, in order to give a definite meaning to language used in the deed, and to show the sense in which particular words were probably used by the parties, especially in matters of description. Where the meaning is doubtful, evidence as to the acts of the parties may be admitted to show the intent. But where the terms of the deed are plain and intelligible, and the instrument can operate, evidence as to the acts of the parties claiming under it is not admissible. The intent, when clearly expressed, cannot be altered by evidence of extraneous circumstance."

In Bain v. Tye, 160 Ky. 408, 169 S.W. 843, this court said:

"It is an elementary rule in the interpretation of deeds that the intention of the parties should be effectuated, and in doing this a liberal construction is given to deeds inartificially and untechnically drawn. The intent must primarily be gathered from a fair consideration of the entire instrument and the language employed therein, and should be consistent with the terms of the deed, including its scope and subject-matter. * * * Where the description of the property intended to be conveyed is ambiguous, the identity of such property must be gathered from the intention of the parties, as shown by the instrument itself and the accompanying circumstances, such as those surrounding and connected with the parties and the land, at the time."

In Thompson v. Thompson, 2 B. Mon. 161, the court said:

"The intention of the parties is a fundamental, and should be a governing principle, in the construction of all instruments and when the language is ambiguous or of doubtful import, it is allowable to look behind the instrument into the state and condition of the...