Lopes v. Capital Co.

• Court: California Court of Appeals
• Writing for the Court: WARNE; VAN DYKE, P. J., and PEEK
• Citation: Lopes v. Capital Co., 192 Cal.App.2d 759, 13 Cal.Rptr. 787 (Cal. App. 1961)
• Decision Date: 05 June 1961
• Parties: Manuel LOPES and Mary Lopes, his wife, also known as Manuel L. Sardinha and Mary Sardinha, his wife, Plaintiffs and Appellants, v. CAPITAL COMPANY, a Corporation; Honolulu Oil Corporation; Bankline Oil Company; Amerada Petroleum Corporation; and Pacific Gas & Electric Company, a Corporation, Defendants, Capital Company, a Corporation, and Honolulu Oil Corporation, Respondents. Civ. 10085.

Page 787

13 Cal.Rptr. 787

192 Cal.App.2d 759

Manuel LOPES and Mary Lopes, his wife, also known as Manuel L. Sardinha and Mary Sardinha, his wife, Plaintiffs and Appellants, v. CAPITAL COMPANY, a Corporation; Honolulu Oil Corporation; Bankline Oil Company; Amerada Petroleum Corporation; and Pacific Gas & Electric Company, a Corporation, Defendants Capital Company, a Corporation, and Honolulu Oil Corporation, Respondents.

Civ. 10085.

District Court of Appeal, Third District, California.

June 5, 1961.

Anthony J. Kennedy, Sacramento, for appellant.

Downey, Brand, Seymour & Rohwer, Devlin, Diepenbrock & Wulff, Sacramento, for respondent.

WARNE, Justice pro tem.

Appellants have appealed from a summary judgment in favor of the respondent, Capital Company, a corporation, and also from a summary judgment in favor of the respondent, Honolulu Oil Corporation.

Appellants, as plaintiffs, brought this action against the respondents and others for a declaration of rights and obligations under a deed to farm lands owned by them that reserved all oil, gas and mineral rights in the grantor, respondent Capital Company, and which rights were under lease to the respondent Honolulu Oil Corporation.

The complaint alleged four causes of action. The first cause of action, in substance, alleges that on January 7, 1954, the Capital Company was the owner in fee simple of certain farm lands; that on said date for a valuable consideration it deeded the lands to the appellants, excepting and reserving to itself from the grant the oil, gas and other hydrocarbons and mineral rights, together with incidental easements and rights necessary for the production and transportation of such oil and gas, all upon the condition that the Capital Company should compensate appellants for, (1) Damage done in the exercise of the reservation to the surface of the lands and improvements; (2) The value of the lands taken; and (3) Any injuries suffered through prevention of farming. It was alleged that Honolulu Oil Corporation was the lessee of the oil, gas and mineral rights from Capital Company. The first cause of action then alleged as follows: A series of entries and takings by the lessee under the gas and oil rights reservation and its interference with appellants' farming operations; that there had been no compensation paid the appellants except for crop losses which occurred prior to October 1956; that the respondents have repudiated the conditions the deed placed upon the gas, oil and mineral rights reservation; that an actual controversy existed between the appellants and the respondents as to the meaning of the terms and provisions of the grant deed, to wit: appellants claimed that the reservation of the respondent Capital Company automatically terminated upon its failure to compensate appellants and that they are the owners in fee simple absolute of the real property involved, including the oil, gas and mineral rights, and are therefore entitled to any and all rents and royalties from the lessee. Whereas, on the other hand, respondents contend that the reserved remainder of the oil, gas and mineral rights continued to exist until terminated by judgment and that respondent Capital Company is entitled to any rents and royalties for oil and gas extracted from the lands. Declaratory relief is requested defining the rights of the parties and declaring that appellants as owners of the fee are entitled to all rents and royalties from the Honolulu Oil Corporation.

The second cause of action seeks to quiet title to the oil, gas and other hydrocarbons and mineral rights by reason of the asserted breach alleged in the first cause of action.

The third cause of action is one against the Capital Company alone to recover damages for the failure to compensate appellants for land taken, crops destroyed, and interference with farming.

The fourth cause of action seeks an accounting of oil and gas royalties paid by Honolulu Oil Corporation to the Capital Company in the event that the declaration should be that the exception or reservation in the grant deed terminated by reason of its breach.

Respondents made separate motions for summary judgment under the provisions of section 437c of the Code of Civil Procedure on the ground that there was no merit to the actions as there are no triable issues of fact. The motions were supported by affidavits. From the averments in the afficavits it appears that the respondent Capital Company executed a lease of the oil, gas and mineral rights to respondent Honolulu Oil Corporation; that the lease was amended in 1943 and recorded; that subsequently, in 1944, Capital Company deeded the lands in controversy to the appellants subject to the lease.

Pursuant to the motion of Capital Company the trial court granted summary judgment as to the first, second and fourth causes of action. A stipulation was entered into between the Capital Company and the appellants that the appellants would not seek to dismiss the judgment or urge its invalidity on the ground that said judgment does not cover all of the alleged causes of action against the Capital Company, nor on the ground that there are other matters pending and unresolved between appellants and Capital Company in the same action.

As to Honolulu Oil Corporation, its motion was granted as to the first three causes of action, which are the only causes of action alleged against that defendant.

Neither in the briefs filed prior to the oral argument nor upon oral argument on appeal was there any discussion as to whether there was a final judgment from which an appeal could be taken under the provisions of section 963 of the Code of Civil Procedure. However, deeming there was a grave question as to appealability, this court requested counsel for the respective parties to file points and authorities addressed to that question. Counsel for Honolulu Oil Corporation and counsel for appellants both contend that the judgment in favor of Honolulu Oil Corporation is a final judgment within the...