Magnolia Petroleum Co. v. Moyle

• Decision Date: 26 January 1946
• Docket Number: 36458.
• Citation: 165 P.2d 419,160 Kan. 722
• Parties: MAGNOLIA PETROLEUM CO. v. MOYLE.
• Court: Kansas Supreme Court

165 P.2d 419

160 Kan. 722

MAGNOLIA PETROLEUM CO. v. MOYLE.

No. 36458.

Supreme Court of Kansas

January 26, 1946

Rehearing Granted April 11, 1946.

Appeal from District Court, Stevens County; F. O. Rindom, Judge.

Action by Magnolia Petroleum Company against John W. Moyle, to quiet title to certain mineral interests. Judgment for plaintiff and defendant appeals.

Reversed and remanded with instructions.

Syllabus by the Court.

1. Where a court has jurisdiction of the parties to an action and of the subject matter thereof, and renders a judgment within its competency, such judgment is final and conclusive unless corrected or modified on appeal or by such other method as may be prescribed by statute.

2. When such a judgment has become final, it cannot be attacked collaterally.

3. One claiming an interest in real estate, whose rights have been adjudicated and cut off in a tax foreclosure action, may not in an action brought to quiet his claimed title, attack the sufficiency of the judgment in such tax foreclosure action.

HOCH and BURCH, JJ., dissenting.

Roy C Davis, Warren H. White, Frank S. Hodge, Wm. H. Vernon, and Eugene A. White, all of Hutchinson, for appellant.

R. C Russell, of Great Bend, and Jos. G. Carey, W. F. Lilleston George C. Spradling, Henry V. Gott, and Ralph M. Hope, all of Wichita, for appellee.

THIELE Justice.

This was an action to quiet title to certain mineral interests in and under the Northwest Quarter of Section 23, Township 31, Range 38, in Stevens County, hereafter referred to as the real estate. The principal matter in controversy was the force and effect of a judgment, sale and sheriff's deed in a previous tax foreclosure action covering the real estate. The cause was submitted to the trial court upon the pleadings, an agreed statement of facts and briefs of the parties, and it rendered judgment in favor of plaintiff. The defendant appeals.

The record discloses the following: The plaintiff, hereinafter referred to as the company, is a Texas corporation, authorized to do business in Kansas. Under date of October 31, 1927, the then owner of the real estate executed and delivered to the company a mineral deed conveying an undivided one-half interest in the minerals in and under the real estate with a perpetual and irrevocable right and easement of ingress and egress in the real estate for the purposes of exploration and development, to conduct operations, to erect structures necessary, to have right of way for and to lay and operate pipe lines, telegraph and telephone lines, free use of water, and to have and enjoy all other rights, easements and privileges necessary, incident or convenient in the operation of the real estate for the production of minerals, provided that grantor upon paying one-half of all expenses and costs of production, should be entitled to receive one-half of the net profits arising from the sale and disposition of said minerals in their natural state and as produced and sold from the real estate, all as more specifically set forth in the mineral deed. Without specifying the exact terms, the company also received the right to lease the real estate for mineral rights as fully as if it were the absolute owner of the entire title, provision being made for division of income, royalties, rentals and bonuses in any lease. The above deed was duly recorded January 2, 1928. Since that date Stevens County duly assessed and levied taxes against the company's mineral interest and the company promptly paid the taxes assessed for each year to and including 1943, and no tax on the mineral interest ever became delinquent.

On October 31, 1937, Mildred M. Robinson and R. B. Robinson, her husband, then the owners of the real estate, executed and delivered to the company, an oil and gas lease of common form. The primary term of this lease was ten years. Provision was made for exploration or for delay rentals. There has been no default under this lease but the real estate has not been explored for oil or gas.

On April 8, 1942, the board of county commissioners of Stevens County instituted a tax foreclosure action, among the parties defendant being Mildred M. Robinson and R. B. Robinson, her husband, and Magnolia Petroleum Company, a corporation. In the petition it was alleged that the defendants named in the caption were owners, supposed owners, mortgagees and lien holders, or have or claim to have some interest in the real estate described in Exhibit 'A' attached to and made a part of the petition; that the several tracts of real estate had been sold at tax sale and had not been redeemed; that the county had a lien because of unpaid taxes; and other appropriate allegations. In the exhibit attached the above described real estate was listed as being sold for taxes of 1933 on September 4, 1934, and that the amount of taxes, interest and penalties to June 1, 1942, was $268.08 and that the name of the owners, supposed owners and parties having or claiming to have some interest therein or thereto were: 'Mildred M. Robinson and R. B. Robinson, her husband; Magnolia Petroleum Company, a corporation.' Thereafter personal service of summons was made on the Robinsons and service by publication was had on the company. These defendants made default and judgment was entered for the sale of the real estate, and that by the sale of each tract involved, all right, title and interest of the defendants be barred. Notice of sale was given and at the sheriff's sale held on September 23, 1942, the real estate was sold for $950 to John W. Moyle, who is hereafter referred to as Moyle. This sale was confirmed and under date of October 8, 1942, a sheriff's deed was executed and delivered to Moyle which was recorded October 15, 1942.

On March 21, 1944, the action out of which this appeal arises was commenced by the company's filing a petition in which Moyle was the only defendant, alleging it was a Texas corporation, authorized to do business in Kansas, and that it was the owner of an undivided one-half interest in and to all the oil, gas and other minerals in and under the real estate described and that Moyle claimed some right therein, with other allegations pertinent to a quiet title action. The prayer was that Moyle be required to set up his claim; that the company be decreed the owner in fee simple and that Moyle be barred; and that the company's title be quieted. Moyle filed an answer and cross petition, but we need notice only his answer in which he alleges he is owner of the real estate, free and clear of any claims of the plaintiff; that he is in possession of the real estate and his ownership is based on the above mentioned sheriff's deed and the proceedings leading up to its execution and delivery and that the company's right in the real estate was adjudicated in that action, and the judgment is final. Other allegations need not be noted. Moyle prayed that his title be quieted as against the company. The company's reply need not be noted, further than it admitted Moyle was the grantee in the sheriff's deed issued pursuant to the proceedings in the tax foreclosure action.

The trial court found that the company was the owner of an undivided one-half interest in all the oil, gas and other minerals in and that may be produced from the real estate, and all other rights, titles and property vested in it by reason of the mineral deed to it dated (recorded) January 2, 1928, and that its title should be quieted against Moyle, and it rendered judgment accordingly. From this judgment Moyle duly perfected his appeal to this court. His specifications of error cover the matters herein discussed.

In this court Moyle contends that any rights and claims the company had in the real estate were settled and determined in the tax foreclosure action; that the matter of such right and claim is res judicata; and that the company, in the present action, may not collaterally attack the judgment in the first mentioned action. The gist of the company's argument, in support of the trial court's judgment, is that in order for the state or county to foreclose a tax lien, there must have been such a lien; that there was none in the tax foreclosure suit; that Moyle, who purchased at the sale, was a purchaser caveat emptor and therefore not in good faith; that he was bound to take notice of the tax records and therefore the judgment in the quiet title proceedings was not erroneous. In support of its contentions the company relies principally on Board of Com'rs of Montgomery County v. Wilmot, 114 Kan. 819, 221 P. 276, to which reference is later made.

The first question for consideration is the binding force of the judgment in the tax foreclosure action. The statutes in force when it was commenced and completed are found in G.S.1943 Supp., sections of which are hereafter noted. For present purposes we note that under 79-2801 it is provided that in all cases in which real estate has been sold and bid in by the county at any delinquent tax sale and shall remain unredeemed for a period of three years after such sale, the board of county commissioners shall order the county attorney to institute an action in its name 'against the owners or supposed owners of such real estate and all persons having or claiming to have any interest therein or thereto,' and that the petition shall state the amount of taxes, charges interest and penalty against each tract of real estate 'and the name of the owner, supposed owner, and party having or claiming to have any interest therein or thereto,' and that when the petition is filed summons shall issue and be personally served or publication made as provided in other cases under the code of civil procedure. Under 79-2802 provision is made for joinder of parties defendant. Under 79-2803...