Moore v. West

• Decision Date: 08 March 1922
• Docket Number: (No. 6700.)<SMALL><SUP>*</SUP></SMALL&gt
• Citation: 239 S.W. 710
• Parties: MOORE et al. v. WEST et al.
• Court: Texas Court of Appeals

239 S.W. 710

MOORE et al. v.WEST et al.

(No. 6700.)^*

Court of Civil Appeals of Texas. San Antonio.

March 8, 1922.

Rehearing Denied April 5, 1922.

Appeal from District Court, Uvalde County; Joseph Jones, Judge.

Action by Emma S. West and others against W. V. Moore and others.Judgment for plaintiffs, and defendants appeal.Amended and affirmed.

Brooks, Worsham & Rollins, of Dallas, G. B. Fenley, of Uvalde, and W. H. Graham, of Dallas, for appellants.

L.Old, of Uvalde, Geo. C. Herman, of Batesville, and Clamp, Searcy & Clamp, of San Antonio, for appellees.

COBBS, J.

This suit was instituted by appellees in the district court of Uvalde county to recover of and from appellants the sum of $10,000.The suit grew out of a transaction whereby appellees leased and let unto W. V. Moore and W. R. Bishop, lessees, for the sole purpose of mining, operating, and exploring for oil and gas, and laying pipe lines, building tanks, power stations, and structures to produce, save and take care of said products, all that certain land situated in the counties of Uvalde and Zavalla described in appellees' petition as a large body of ranch land.The consideration for the execution of said oil lease and drilling contract on said property was that the said Moore and Bishop were to begin the actual work of drilling for oil or gas on some part of said leased premises on or before November 3, 1920, and to diligently prosecute the drilling of said well to a depth of 3,000 feet, unless oil or gas should be found in paying quantities at a less depth.It is not necessary to set out the various provisions of the lease contract.But the lease was not to become effective until the said Moore and Bishop should execute a good and solvent bond in the sum of $10,000, guaranteeing the compliance on their part with said provisions in said lease, and place said contract with the bond in escrow, same not to be delivered until Moore and Bishop had actually and in good faith complied with said drilling clause in said contract, said lease and bond to be disposed of by said escrow agent in accordance with written instructions accompanying the deposit of said contract and bond in escrow.

On the 24th day of May, 1920, appellants, W. V. Moore and W. R. Bishop, as principals, with appellantsF. O. Witchell, Otto N. Lang, F. M. Jackson, J. E. Cunningham, H. E. Spafford, H. H. Kidd, J. W. Vilbig, and National Surety Company, as sureties, execute a bond, payable to appellees, their heirs, executors, and administrators, jointly and severally, in the sum of $10,000 conditioned that if the said Moore and Bishop "shall on or before the 3d day of November, 1920, actually begin, or cause to be begun, the drilling of a well for oil or gas on some part of the premises, set forth and described in a certain oil and gas lease dated May 3, 1920," in which the obligees mentioned in said bond are the lessors in said lease, and the principals in said bond are the lessees in said lease, then said obligation to be void, otherwise to remain in full force and effect.

After the execution of said oil lease and drilling contract and said bond, they were delivered to the Commercial National Bank of Uvalde, to be held in escrow until advised by appelleeA. W. West that Moore and Bishop had actually begun the drilling of a well on some part of the premises within six months from date of same, or until said bank had been satisfied by good and sufficient proof that said well drilling had begun within the time of said lease, in which event said oil and drilling contract and said bond were to be delivered by said bank to said Moore and Bishop.In the event, however, said bank was advised by said A. W. West that the lessees in said oil lease and drilling contract failed to comply with the terms of said contract in beginning the actual drilling of a well on some part of said leased premises within said six months from the date of said lease, and shall furnish said bank good and sufficient proof of said fact, then said oil lease and drilling contract and said bond were to be delivered by said bank to said A. W. West.

The wording of the letter to said escrow agent was agreed upon by appellees and J. E. Cunningham, acting for W. V. Moore and W. R. Bishop, and said letter written May 3, 1920, a copy of which, together with lease contract, were on said date furnished to appellantJ. E. Cunningham.AppellantH. E. Spafford acted for appellants in procuring and delivering to appellees the said bond sued upon.Prior to procuring same he had had in his possession a copy of said letter to said escrow agent, as well as a copy of the lease contract, and all the defendants(appellants) were advised of the contents of said letter to said escrow agent, and of the contents of the lease contract prior to the execution and the delivery of the bond.

That W. V. Moore and W. R. Bishop failed to actually begin, or cause to be begun, the drilling of a well for oil or gas on some part of the premises, as they contracted to do on or before November 3, 1920.Moore and Bishop, appellants, shortly prior to November 3, 1920, caused a derrick to be erected on said leased premises, rented a boiler and engine and certain tools, and dug a hole some six or eight inches or more deep, nothing further being done, but within a few days thereafter said boiler and engine and said tools were removed from said premises, and no attempt to otherwise actually begin, or cause to be begun, the drilling of a well for oil or gas on said leased premises was made before November 3, 1920.That the acts and things done by appellants were a trick and subterfuge and an attempt to evade the payment of the bond.

That after said hole six or eight inches deep had been dug, Moore and Bishop went to Uvalde and demanded of the escrow agent, the bank, the said lease and said bond, but that, said agent not being satisfied, made inquiry as to what had been done, and upon such information refused to deliver the same to them, but retained possession thereof until November 4, 1920, when they were forwarded to appellees' attorneys in San Antonio, Tex. Whereupon demand was made upon each of the appellants that Moore and Bishop had breached the terms of the lease contract and the bond and demanded the payment of said bond.

We have made the statement as full as it is to have a better understanding of what is alleged to meet the demurrers interposed, without hereafter setting out the same in passing on them.

The National Surety Company answered separately from its codefendants, who likewise filed separate answer.

All the defendants, the appellants here, in their separate answers filed numerous general and special exceptions, all of which were overruled.The petition set out a good cause of action independent of allegations complained of that do not materially affect plaintiffs' real right of recovery, based upon sufficient material allegations showing a substantial and real cause of action, and there was no error in the rulings of the court on the several demurrers.

The case was tried by the court without a jury, and the court rendered judgment for appellees in the sum of $10,000.There were no findings of the court requested.A statement of facts was filed.

The real and substantial defense made and urged in the assignments and propositions in this case is that the appellants, the lessees, Moore and Bishop, the principals in the bond, satisfied the terms and obligations in the bond stipulated, when they"began the drilling of a well for oil or gas," as provided in the bond, to which alone, it is urged, we must look, and to no other obligation, expressed or implied from the lease contract or the escrow agreement.It makes no difference, it is argued, how slight that was; it satisfied the bond and entitled them to the lease contract.The lease, bond, and written escrow agreement were contemporaneous agreements, and they will be construed and considered together to arrive at the true meaning and intent of the parties so as to ascertain what facts were necessary to be established to understand what was meant by "to begin the drilling of a well for oil or gas," and what the obligation was to stand for.The language of the lease, to which the bond refers, to guarantee, is:

"Lessees, or their assigns, shall begin actual work of drilling for oil or gas on some part of said leased premises, on or before November 3, A. D. 1920, and shall diligently prosecute the drilling of said well to a depth of three thousand (3,000) feet, unless oil or gas is found in paying quantities at a less depth, and should lessees fail or refuse to complete said well to a depth of three thousand (3,000) feet, unless oil or gas is found in paying quantities at a less depth, this lease shall become null and void."

The condition of the bond is:

"That if the said W. V. Moore and W. R. Bishop, their heirs, executors, administrators, or assigns, shall on or before the 3d day of November, 1920, actually begin or cause to be begun the drilling of a well for oil or gas on some part of the premises set forth and described in a certain oil and gas lease dated May 3, 1920, in which the obligees mentioned herein are the lessors in said lease, and the principals herein are the lessees named in said lease, the said premises being a part of the Ike West ranch situated in the counties of Uvalde and Zavalla, then this obligation to be void, otherwise to remain in full force and effect."

This bond was forwarded to S. S. Searcy, attorney for appellees, by H. E. Spafford, an attorney from Dallas, himself being one of the sureties, in a letter of the 3d of May, 1920.He was the one selected to secure the bond.The lease and bond were deposited by Clamp, Searcy & Clamp in escrow in the Commercial National Bank of Uvalde, Tex.The escrow instrument was in the shape of a letter, and is as follows:

"Commercial National Bank, Uvalde, Texas— Dear Sirs: We hand you herewith the following papers:...