Lee v. Perkins

• Decision Date: 28 June 1940
• Docket Number: 34791.
• Citation: 195 La. 939,197 So. 607
• Court: Louisiana Supreme Court
• Parties: LEE et al. v. PERKINS.

197 So. 607

195 La. 939

LEE et al. v. PERKINS.

No. 34791.

Supreme Court of Louisiana.

June 28, 1940

Rehearing Denied July 18, 1940.

Appeal from Twenty-Sixth Judicial District Court, Parish of Webster J. F. McInnis, Judge.

Suit by James Lee and others against J. E. Perkins to have annulled and set aside, on ground of lack of consideration, an oil and gas lease and a mineral deed. From an adverse judgment, the plaintiffs appealed. After the case was lodged in the Supreme Court on appeal, the plaintiffs filed a motion to remand the suit to the lower court to have themselves declared to be the owners of the two-thirds mineral interest in controversy which had been transferred by the defendant to Paul L. Miller and to John T. Campbell during pendency of the suit, on payment by the plaintiffs of the consideration recited in the deeds, with interest. Judgments were rendered in favor of the plaintiffs with respect to the transfer from the defendant to Paul L. Miller, and the defendant and Paul L. Miller appeal and against the plaintiffs with respect to the transfer from defendant to John T. Campbell, and the plaintiffs appeal.

Judgment set aside, and judgment decreed in favor of the plaintiffs against the defendant.

Jackson & Mayer, of Shreveport, for plaintiffs and appellants-appellees.

Campbell & Campbell, John T. Campbell, D. W. Stewart, Jr., and Clifford E. Hays, all of Minden, for defendants and appellants-appellees.

FOURNET, Justice.

Plaintiffs instituted this suit to have annulled and set aside, on the ground of lack of consideration, a certain oil and gas lease and a deed of two-thirds of the minerals affecting eighty acres of land located near what is known as the Cotton Valley Oil Field in Webster Parish, Louisiana, executed by Willie Jordan as their (plaintiffs') agent and attorney in fact in favor of James E. Perkins.

Defendant excepted to plaintiffs' petition on the ground that B. S. SoRelle, who had acquired the lease from him (defendant) prior to the institution of this suit, was a necessary party thereto. Whereupon plaintiffs supplemented and amended their petition alleging that they believed SoRelle acquired the lease in good faith without knowledge of the fraud perpetrated upon them by his assignor (Perkins) and prayed for judgment against Perkins for the cancellation of the mineral deed and for the amount he (Perkins) received as the consideration for the assignment of the lease to SoRelle. The trial judge maintained the exception and ordered the suit dismissed but, on a rehearing, amended his order so as to dismiss plaintiffs' suit only in so far as it sought to cancel the lease.

In his answer the defendant denied that the instruments sought to be annulled were executed without consideration and averred that the true and actual consideration for their execution was not the cash amounts recited in the acts but was, in fact, his (Perkins's) agreement to furnish the necessary money to effect a redemption of plaintiffs' property which had been sold at a tax sale to H. R. Hayes and his actual payment of this amount at the request of Willie Jordan, agent of the plaintiffs.

After the case was lodged here on an appeal taken by the plaintiffs from a judgment dismissing their suit, they filed a motion to remand the same to the lower court so that they might institute the necessary proceedings there to avail themselves of the provisions of Article 2652 of the Revised Civil Code and have themselves declared to be the owners of the two-thirds mineral interest in controversy, which had been transferred by Perkins to Paul L. Miller and John T. Campbell during the pendency of this suit, upon their payment of the consideration recited in the deeds, with interest. See Lee v. Perkins, 192 La. 1049, 190 So. 126. Accordingly, rules were issued in the lower court, one against Perkins and Miller and the other against Perkins and Campbell, to show cause why the plaintiffs should not be granted this relief. Judgments were rendered in the lower court (1) in favor of plaintiffs, making the rule absolute with respect to the transfer from Perkins to Miller, from which judgment the latter two have appealed, and (2) against the plaintiffs, recalling the rule and rejecting their claim with respect to the transfer from Perkins to Campbell, and from this judgment plaintiffs have appealed.

In our decision on rehearing in the recent case of Smith v. Cook, 189 La. 632, 180 So. 469, 473, we pointed out that the object of the articles of the Revised Civil Code dealing with litigious rights (Article 2652, etc.) ‘ was primarily ‘ to prevent the purchasing of claims from avarice or to injure the debtor. * * *’ And in order to carry into effect the purpose of the law, the one against whom the claim is purchased is permitted to invoke the provisions of the Civil Code, art. 2652, against such a purchaser and release himself therefrom by paying the purchaser the price of the transfer, together with interest from the date thereof. * * * He is given the absolute right to take over the third party's deal or bargain upon reimbursing the transferee the price paid therefor with interest, and the matter is considered as though he had compromised with his opponent for such amount.'

In response to the rule taken with respect to the transfer from Perkins to Miller, it was urged as a defense that the recited consideration was never paid and that the same was executed solely for the convenience of Perkins and had as its purpose the placing of the community property out of his hands until such time as he could effect a settlement with his wife, who was contemplating divorce proceedings against him, and that, long prior to the time plaintiffs filed their motion to remand, the property had been retransferred to him (Perkins).

In Illg & Valentino v. Regan, 166 La. 70, 116 So. 673, 674, this court refused to remand the case to the lower court because the attorney therein who acquired his client's judgment while the case was pending on appeal here had ‘ entered into a contract with defendant [his client], rescinding the sale and reconveying the judgment to the latter,’ holding that ‘ By this act matters were placed in the same position as they were before Ramos [the attorney] purchased the judgment.’ (Brackets ours.)

At the time we remanded this case to the lower court, we were not apprised of the facts with respect to the transfer, and, the mineral interest having been retransferred by Miller to Perkins prior to the time the appeal was taken here, thus placing the status of this mineral interest in the same position it was before the transfer by Perkins, the judgment of the lower court authorizing the transfer of this interest to the plaintiffs upon their payment of the consideration recited therein, with interest, is, therefore, erroneous.

On the trial of the rule with respect to the transfer from Perkins to Campbell, it was shown that the true consideration for this transfer, as evidenced by a written contract of employment dated August 25, 1936, was that he (Campbell) would receive a half of Perkins's interest in these mineral rights in return for his legal services in connection with this suit and Campbell stated that his reason for stipulating the consideration was $250 in cash was to facilitate any subsequent disposition he might wish to make of these rights.

We have held that under the express provisions of Act No. 124 of 1906 attorneys-at-law may acquire by written contract with their clients ‘ an interest in the subject matter of the suit, proposed suit or claim, in the prosecution or defense of which they are employed.’ See Hope v. Madison, 194 La. 337, 193 So. 666. We therefore conclude that the trial judge's ruling dismissing plaintiffs' demands with respect to this claim is correct.

Passing now to the main demand, it is necessary that a brief statement of the facts in this case be given in order that the same may be properly disposed of.

Plaintiffs own the N.W. 1/4 of the N.E. 1/4 and the S.E. 1/4 of the N.W. 1/4 of Sec. 31, Tp. 21 N., R. 10 W., in Webster Parish, Louisiana, having inherited the same from their ancestors James and Elnora Lee, both deceased. The property was under lease to two of the grandchildren of James and Elnora Lee, Willie and Lloyd Jordan, for cultivation purposes, the consideration for such lease being that they would maintain the improvements and pay the taxes on the property. They failed to pay the 1931 taxes and the property was sold at tax sale on December 17, 1932, to H. R. Hayes; the tax deed, however, was not recorded until December 17, 1935. On the same day (December 17, 1935) Willie Jordan, who, during the month of August previous had procured from the plaintiffs a power of attorney authorizing him to redeem the property and also authorizing him to sell any portion of the oil, gas, and other minerals in and under the said land and to lease the same on such terms and for such price as he might deem fit, as the agent and attorney in fact of the plaintiffs, executed in favor of Perkins (1) a mineral lease, for the recited consideration of $80, and (2) a mineral deed conveying two-thirds of the minerals under the property, for a recited consideration of $75. Both of these acts were recorded on February 26 of the following year. On August 12, 1936, Perkins assigned the lease to B. S. SoRelle for $1,000 cash, and, on the same day, he tendered Hayes $140 in the form of a cashier's check with the request that he (Hayes) execute a tax redemption deed. This check remained uncashed until Hayes was compelled to accept same and execute the deed in a subsequent court action.

On the trial of the main demand the plaintiffs, after obtaining Perkins's admission...