Mills v. Reneau
| Decision Date | 28 December 1965 |
| Docket Number | No. 41061,41061 |
| Citation | 1965 OK 209,411 P.2d 516 |
| Parties | W. E. MILLS, Plaintiff in Error, v. Winnifred RENEAU, Pearl Litteer, Hazel Reneau Milby, C. C. Reneau and Eva Reneau Stevens, Defendants in Error. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court
1. An instrument purporting to be an absolute conveyance of real estate, but intended to be defeasible or as security for the payment of money, is deemed a mortgage, and must be recorded and foreclosed as such.
(a) The holder of a deed absolute, taken as a security for a debt, can only acquire title by a foreclosure of his mortgage, and any agreement of forfeiture is void.
(b) Any person having an interest in the mortgaged real estate may redeem from such deed.
2. Under and by the virtue of 42 O.S.1941, § 23, a mortgagor or his heirs may successfully institute and maintain an action to quiet title against the mortgagee, not in possession of the mortgaged property, when the mortgage lien has been extinguished by a lapse of time sufficient to bar an action upon the mortgage debt.
3. In an action of purely equitable cognizance this court will consider the entire record and weigh the evidence and cause to be rendered such judgment as the trial court should have rendered.
Appeal from the District Court of Grady County; L. A. Wood, Judge.
Action by plaintiffs, successors in interest of grantee, to quiet title to mineral interest under deed intended as a mortgage. The trial court quieted plaintiffs' title and denied defendant relief upon cross-petition, and defendant appeals. Reversed and remanded with directions.
Paul Pugh and AL Pugh, Oklahoma City (Carrol Womack, Oklahoma City, on the brief), for plaintiff in error.
W. E. Robertson, of Robinson, Robertson & Barnes, Oklahoma City, for defendants in error.
This is an appeal by plaintiff in error from a judgment entered in favor of defendants in error, herein denominated plaintiffs, in an action brought to quiet title to mineral interests in Grady County, Oklahoma.
The petition alleged that on September 18, 1930, defendant conveyed to H. W. Reneau, plaintiffs' predecessor in title, an undivided 15/240ths mineral interest in the 'Southeast Quarter of Northeast Quarter and East Half of Southeast Quarter of Section 21 and Southwest Quarter of Northwest Quarter and West Half of Southwest Quarter of Section 22 all in Township 5 North, Range 6 West.' At the date of execution and delivery of this deed, which was recorded November 30, 1931, defendant owned no mineral interest in the described land in Section 22, although the deed contained a warranty of title. The grantee (Reneau) died in 1945 and his estate passed to his wife for life, and upon her death in July, 1946, the present plaintiffs succeeded to all right and interest in the property. The petition also alleged and the record shows that on January 21, 1948, one-eighth mineral interest was conveyed by quit claim deed to the defendant by the then owner, Mineral Royalties, Inc. Upon this basis plaintiffs alleged that by virtue of the doctrine of after acquired title, an undivided 15/240ths mineral interest vested in plaintiffs, successors in interest of H. W. Reneau, upon recordation of the quit claim deed to defendant. Plaintiffs further alleged that they, through their predecessor in interest, at all times had been in constructive possession of such mineral interest and sought judgment quieting their title against defendant.
Defendant answered admitting execution and delivery of the deed and matters showing plaintiffs were successors of H. W. Reneau. Defendant alleged the deed was given to Reneau as security for an existing indebtedness; as part of the same transaction defendant and Reneau entered into a written memorandum by terms of which Reneau held title to the mineral interest in trust as security for the debt. Defendant then offered to do equity by tendering the amount due upon the indebtedness, with interest, and specifically alleged the trust deed had not been foreclosed; denied that plaintiffs or their predecessors in interest had been in possession of the minerals; and alleged the trust had never been repudiated until suit had been filed.
By cross-petition, styled a counter-claim, defendant alleged plaintiffs were claiming a total of 15 acres mineral interests in described land and prayed judgment quieting his own title to all mineral interests described in Sections 21 and 22.
Plaintiffs' demurrers to the answer and cross-petition were overruled. Plaintiffs replied denying knowledge of the memorandum agreement, and alleged if the conveyance were to Reneau in trust as security for indebtedness such fact was unknown to plaintiffs. Plaintiffs further alleged that they and their predecessors had maintained actual, open, continuous and adverse possession of the minerals for more than 15 years, and any claim by defendant therefore was barred by the applicable statutes of limitation; that any right on defendant's part to reform the mineral deed or to have same declared a mortgage and to redeem therefrom also was barred by limitations, and that defendant was guilty of laches. Plaintiffs also prayed that defendant take nothing by reason of his counter-claim.
Defendant replied to plaintiffs' answer to his counter-claim by general denial, and specifically denied plaintiffs' claim of possession of the minerals, and that laches or any statute of limitations applied to his claim.
Plaintiffs' case was supported by introduction of the mineral deed executed September 18, 1930, by defendant to W. H. Reneau; the conveyance from Mineral Royalties, Inc. to defendant, dated January 21, 1948; the probate court proceedings whereby plaintiffs became successors in interest of W. H. Reneau; and testimony by one of plaintiffs that she had not been upon the property and did not know who held possession of the surface in which plaintiffs claimed no interest. On cross-examination the plaintiff testified to having received a total of $1,000.00 for oil and gas leases upon the particular tract.
Defendant introduced the following Memorandum Agreement in evidence:
'September 18, 1930
'By and between W. E. Mills, party of first part, and W. H. Reneau, party of second part, both of Oklahoma City, Oklahoma. Party of the first part has this date executed mineral deed described as follows:
'The Southeast Quarter of the Northeast Quarter and the East Half of the Southeast Quarter, Section 21 and the Southwest Quarter of the Northwest Quarter and the West Half of the Southwest Quarter of Section 22, Township 5 North, Range 6 West.
'In favor of the second party, in consideration of additional security for the payment of one note executed to T. H. Gilliland, now held by Frank Bosworth Company, 315 Commerce Exchange Building, Oklahoma City, Oklahoma.
'It is agreed that party of the first part is to have sixty days from the 9th day of September, 1930, to redeem mineral deed by full payement of note and interest on same.
s/ 'W. E. Mills
H. W. Reneau.'
Also introduced in evidence was a receipt showing partial payment of $25.00 upon the indebtedness. It is to be noted that plaintiffs admit the genuineness of the memorandum.
Based upon the evidence the trial court found the mineral deed of September 18, 1930, was given as security for indebtedness and was intended by the parties to be defeasible. This correctness of this finding is admitted by plaintiffs. The Court further found that neither plaintiffs, their predecessor in interest, nor defendant ever had been in possession of the surface and no oil or gas had been produced from the property.
The trial court then found the statute of limitations had barred enforcement of the balance of indebtedness due and owing from defendant, and which the deed was given to secure, and defendant's right to redeem such mineral interest also was barred by limitations; that plaintiffs, as successors in interest to W. H. Reneau, were the owners of the described...
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