Jones Drilling Corp. v. Rotman, No. 19276

• Docket Nº: No. 19276
• Citation: 179 N.E.2d 312
• Case Date: January 25, 1962
• Court: Court of Appeals of Indiana

Page 312

179 N.E.2d 312 JONES DRILLING CORPORATION, James C. Jones and Mary Pauline
Jones, Appellants,
v.
Morris ROTMAN and Anna Rotman, Joe Feldman and Eva Feldman, Appellees. No. 19276. Appellate Court of Indiana, In Banc. Jan. 25, 1962.

Opinion Superseded 195 N.E.2d 857.

Paul F. Mason, Rockport, Hays & Hays, by George E. Taylor, Sullivan, for appellants.

Gilbert W. Gambill, of Gambill, Cox, Zwerner & Gambill, Terre Haute, Paul R. Whitlock, Sullivan, for appellees.

GONAS, Judge.

On May 14, 1954, appellees assigned in writing a one half working interest to certain oil and gas leases, which were located in Sullivan County, Indiana, to appellant, Jones Drilling Corporation. Appellant did not give a direct monetary consideration for the assignment. However, certain duties, burdens, and obligations were placed on appellant by the assignment contract.

The contract provided in part:

'In the event the assignee (appellant) shall fail to fully perform the terms and conditions of his assignment contract, or any part thereof, then it is expressly understood and agreed that upon due proof of non-compliance upon the part of the assignee by the assignors, as to all or any one of the terms and conditions hereof, that this assignment shall automatically revert to the assignors herein, heirs or assigns.'

On June 12, 1957, appellees requested, by their complaint, rescission of the assignment contract; and accounting; the appointment of a receiver; a restraining order enjoining appellants from entering the leased premises; and they included a prayer for damages in the sum of Forty Thousand ($40,000.00) Dollars.

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The restraining order was issued without notice, on June 12, 1957, after appellees posted a One Thousand ($1,000.00) Dollar bond to indemnify appellants in the event of damages that might have resulted from the restraining order issued. This bond was increased to Fifteen Thousand ($15,000.00) Dollars upon appellants' request therefor. Appellees failed to post the increased bond and the restraining order was dissolved on June 28, 1957. Previously, the court had found the Jones Drilling Corporation to be the owner of certain items of personal property located on the real estate subject to the oil leases. It was prohibited by the restraining order from entering the leased premises and from moving any items therefrom.

On July 26, 1957, appellees filed an amended complaint seeking only rescission, accounting and damages. Appellees did not request a restraining order or the appointment of a receiver.

The terms and conditions of the contract of assignment are made apparent by appellees' amended complaint against appellants. The amended complaint alleges that the appellants have breached the contract in the following particulars:

'(a) In that they have failed and refused to clean out and operate thrity-seven wells.

'(b) That said defendants have failed to operate and develop water production as provided in said contract.

'(c) That the defendants have pulled a number of said wells and have sold, carried away and disposed of said pipe of said wells without the written consent of the appellees in violation of the terms of the contract as set forth in the contract.

'(d) That defendants have taken, disposed of, sold and appropriated to their own use a part of the personal property listed in the inventory without the written consent of appellees.

'(e) That defendants negligently and carelessly ruined a number of said wells by deepening said wells beyond the 'pay sand', and have totally ruined said wells for further production.'

The complaint charges further, that appellants submitted inaccurate statements of joint expenses to appellees. That appellants charged appellees for items which were used for the sole and exclusive benefit of appellants. That the appellants have caused great and irreparable injury to the appellees by pulling several oil wells which were operating and producing commercial oil.

Appellants' answer to appellees amended complaint amounted to a general denial. Appellants filed a counter-claim, in two paragraphs, against appellees.

The first paragraph of appellants' counter-claim is in the nature of an action in debt. It is asserted that, appellees, Morris Rotman and Anna Rotman, are indebted to appellants in the sum of One Thousand Six Hundred Ninety Five and 63/100 (§ 1,695.63) dollars; and that appellees, Joe Feldman and Eva Feldman, are indebted to appellants in the sum of Three Hundred Sixty Two and 22/100 (§ 362.22) dollars.

The second paragraph of the counterclaim, which was filed by appellants, was based upon the action taken by appellees under their original complaint. It charges that appellees wrongfully caused a restraining order to issue against appellants, which prohibited appellants from renting or leasing certain personal property of which appellants had the lawful possession and the sole privilege to rent or lease. That, as a result of the restraining order, appellants, Jones Drilling Corporation, lost the use and rental of a 60L Bucyrus Spudder for three hundred forty eight (348) hours, and lost the use of two motor vehicles and a pipe trailer for fourteen and one-half (14 1/2) days, all to the damage of the Jones Drilling Corporation, that, as a further result of said restraining order, the Jones

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Drilling Corporation was unable to accept two drilling contracts; by reason of which the Jones Drilling Corporation lost the use of said spudder for an additional six hundred and twelve (612) hours; that, the Jones Drilling Corporation was rendered unable to accept or perform two contracts for the use and rental of two motor vehicles and a pipe trailer because of the restraining order, and as a result, Jones Drilling Corporation lost the use of its property for an additional twenty-five and one half (25 1/2) days. Damages were asked in the sum of Twenty Thousand ($20,000.00) Dollars. Appellees' answer to both paragraphs of the counter-claim amounted to general denials.

Appellants requested trial by jury on each paragraph of its counter-claim. The court denied appellants' requests for trial by jury.

The court rendered judgment favorable to appellees and adverse to appellants. Appellants' motion for a new trial was overruled by the trial court. The assignment of error made by appellants is that the trial court erred in overruling its motion for a new trial.

Appellants have presented argument on thirteen of the causes pressed by them as grounds for a new trial. We shall only consider the argument made by appellants that the court erred in denying a motion for trial by jury on their counter-claim.

In support of the rulings made by the trial court denying the request for trial by jury, appellees argue that their amended complaint sounded in equity and belonged to the exclusive jurisdiction of the equity court; that the entire case was drawn into equity under the rule which declares that if any essential part of a cause is exclusively of equitable cognizance, the whole case is drawn into equity. Hendricks et al. v. Frank et al. (1882), 86 Ind. 278.

We believe that the rule contended for by appellees does not control in this particular case. The second paragraph of appellants' counter-claim was an action at law, as we view it. If we assume that appellees' amended complaint invoked the equitable jurisdiction of the trial court exclusively, that fact would not have cured the trial court's error of denying appellants' timely request for trial by jury on their action for damages for the alleged wrongful issuance of the restraining order.

In W. A. Flint Co. v. John V. Farwell Co., (1922), 192 Ind. 439, 445, 134 N.E. 664, 666, it is stated:

'Where causes of action at law and in equity are stated in different paragraphs of pleading, the issues joined on the paragraphs which state causes of action at law are triable by a jury, and those joined on...