McMillan v. Pawnee Petroleum Corp.
| Decision Date | 21 July 1931 |
| Docket Number | 21461. |
| Citation | 1 P.2d 775,151 Okla. 4,1931 OK 472 |
| Parties | McMILLAN et ux. v. PAWNEE PETROLEUM CORPORATION et al. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
Contracts made by and between foreign corporations and citizens of this state prior to a compliance with the requirements of the domestication statutes are void only at the election of the citizens of the state who were parties thereto; and when a citizen of this state conveys an interest in real estate to such a corporation, receives the consideration therefor, and such conveyance is duly filed for record, in the county where such real estate is located, such transaction becomes an executed contract; and, if said foreign corporation conveys such interest in real estate to any one for a valuable consideration without notice that such corporation has so failed to comply with such domestication statutes, the grantee becomes a bona fide purchaser for value.
"Although a corporation may have acquired real estate in such a manner as to render it subject to be escheated to the state by a proper action begun for that purpose, yet if such corporation shall, prior to the commencement of such proceeding to escheat, make a bona fide sale or conveyance of said real estate for value, the purchaser at such sale will take good title thereto." State ex rel. Short, Attorney General, v. Benevolent Investment & Relief Association, 107 Okl. 228, 232 P. 35, 37 A. L. R. 190.
Additional Syllabus by Editorial Staff.
Appeal from District Court, Logan County; Charles C. Smith, Judge.
Suit by William W. McMillan and wife, against the Pawnee Petroleum Corporation and others. Judgment for the defendants, and the plaintiffs appeal.
Affirmed.
Bierer & Bierer, of Guthrie, for plaintiffs in error.
W. N Stokes, Grant & Grant, and Ed. I. Irwin, all of Oklahoma City, and McGuire & McGuire, of Guthrie, for defendants in error.
This suit was filed on the 1st day of May, 1928, in the district court of Logan county, by the plaintiffs in error, as plaintiffs, against defendants in error, as defendants, to have declared illegal and void and canceled of record a certain mineral deed by which the plaintiffs conveyed the mineral rights in a tract of 160 acres of land in Logan county to the defendant Pawnee Petroleum Corporation, and also to have declared illegal and void and canceled of record a certain deed made by said Pawnee Petroleum Corporation and its transferees, whereby the defendants Welch, Acton & Brown Inc., acquired an undivided one-fourth interest, the defendant Tom Slick, Inc., an undivided one-half interest, and the defendant C. O. Blunk, an undivided one-fourth interest, in and to said mineral rights. In their petition, the plaintiffs tendered and offered to pay the consideration received by them, the sum of $900, to the Pawnee Petroleum Corporation or to any of its grantees whom the court might adjudge and decree were entitled thereto. The defendant Sinclair Oil and Gas Company was the owner of an oil and gas mining lease upon said quarter section of land, and the plaintiffs prayed that the rental under said lease should be paid to them. The defendants Pawnee Petroleum Corporation and Welch, Acton & Brown, Inc., made no appearance in said cause. By agreement of parties, an order of court was entered by which the defendant Sinclair Oil and Gas Company was directed to pay the rentals due under its lease to the clerk of the court to await the final determination of the cause.
The issues were made up between the plaintiffs and the defendants, Tom Slick, Inc., and C. O. Blunk, and the case was tried to the court and judgment was rendered in favor of the defendants, from which judgment the plaintiffs appealed.
The parties hereto will be hereinafter referred to as they appeared in the trial court: William W. McMillan and Lillie McMillan, his wife, plaintiffs in error, as plaintiffs, and Pawnee Petroleum Corporation, Tom Slick, Inc., Welch, Acton & Brown, Inc., C. O. Blunk, and Sinclair Oil & Gas Company, a corporation, defendants in error, as defendants.
The trial court made certain findings of fact concerning which there is no controversy, and which are, in substance, as follows:
On October 26, 1926, the plaintiffs in error, being the owners of lots 3, and 4, and South 1/2 of Northwest 1/4 of section 2, township 18, North, Range 3, West I. M. Logan county, Okla., made a deed to the mineral rights on said premises which was recorded on the 19th day of February, 1927; that the Pawnee Petroleum Corporation at the time of taking said deed was duly chartered under the laws of the state of Delaware, and had power and authority under said charter to take, hold, sell, and deal in lands, and at that time was transacting the business of buying and selling oil and gas leases and mineral interests in lands within the state of Oklahoma, without having complied with the domestication statutes of this state, which provides that a foreign corporation before doing business in this state shall file a certified copy of its charter or articles of incorporation in the office of the secretary of state, pay the fee required by law, and appoint an agent upon whom service of process can be made in any action in which such corporation is a party, and obtain a license to transact business within the state; that on the 16th day of February, 1927, the Pawnee Petroleum Corporation, made, executed, and delivered to Ralph Covey, a mineral deed, to an undivided one-half (1/2) interest in the mineral rights in the above-described tract of land; that on the 22d day of February, 1927, the said Ralph Covey made, executed, and delivered to the defendant in error, Tom Slick, Inc., a deed to such an undivided one-half interest in the mineral rights in the above-described tract of land; which deeds were duly filed for record, and recorded in the office of the county clerk of Logan county, Okl., on the 25th day of February, 1927; that on the 31st day of March, 1927, the Pawnee Petroleum Corporation made, executed, and delivered to the defendant in error, C. O. Blunk, a deed conveying to the said C. O. Blunk, an undivided one-fourth interest in and to all the mineral rights in the said above-described tract of land; which said deed was duly filed for record, and recorded in the office of the county clerk of Logan county, Okl., on the 1st day of April, 1927; that thereafter on the 28th day of June, 1927, said corporation complied with such domestication statutes and obtained from the corporation commission of the state of Oklahoma, a license to do business within the state.
The sole question presented in this case is whether a mineral deed made by a citizen and resident of this state by which such citizen attempts to convey the mineral rights to land located within this state to a foreign corporation, and the mineral deeds thereafter made by such foreign corporation and its transferees, whereby it is attempted to convey such mineral rights to other persons, before such foreign corporation has complied with the domestication statutes of this state, are void and subject to be canceled of record upon the suit of such citizen, even though such deeds were each based upon a valuable consideration fully paid, were recorded in the office of the county clerk, and the subsequent transferees having so purchased such mineral rights from such foreign corporation without actual knowledge that such foreign corporation had not complied with such domestication statutes.
It is the contention of the plaintiffs in error that the mineral deed of the McMillans, the plaintiffs herein, was illegal and void because it was made in violation of the foreign corporation statutes of this state. Also, that the mineral deed to the Pawnee Petroleum Corporation being void as to the corporation, no rights could be acquired under it by Welch, Acton & Brown, Inc., who defaulted for pleading below, or Tom Slick, Inc., or C. O. Blunk, who purchased their mineral rights from or through the Pawnee Petroleum Corporation, and that it makes no difference whatever that they purchased the same in good faith and paid a valuable consideration therefor, without knowledge that the Pawnee Petroleum Corporation had not, prior to said transaction, domesticated and complied with the foreign corporation laws of the state of Oklahoma, or, in brief, that said deed to the Pawnee Petroleum Corporation is absolutely void and that any person can take advantage of it. On the other hand, it is the contention of the defendants in error Tom Slick, Inc., and C. O. Blunk, that the deed from the plaintiffs in error to the Pawnee Petroleum Corporation was at most voidable, and that the Pawnee Petroleum Corporation, having transferred all of its title to said property by good and sufficient deeds before any action was brought by the plaintiffs in error to void the contract, good title passed to the grantees of the Pawnee Petroleum Corporation.
It is further contended by the defendants Tom Slick, Inc., and C. O. Blunk, that the plaintiffs, by their deed to the Pawnee Petroleum Corporation, proclaimed to the world that the Pawnee Petroleum Corporation was legally capable of taking title to the property involved, and that they cannot now be heard to deny its capacity to take.
Can the plaintiff, after having completed a sale of an interest in real estate, in that they made, executed, and delivered the mineral deed in question to the Pawnee Petroleum Corporation an undomesticated foreign corporation, and received the full consideration therefor, the contract being fully executed, in the absence of fraud, subsequently urge that their executed contract entered into at the time with such undomesticated foreign corporation is void...
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