Parker v. Parker

• Decision Date: 10 October 1940
• Docket Number: No. 11054.,11054.
• Citation: 144 S.W.2d 303
• Parties: PARKER et al. v. PARKER et al.
• Court: Texas Court of Appeals

144 S.W.2d 303

PARKER et al. v. PARKER et al.

No. 11054.

Court of Civil Appeals of Texas. Galveston.

October 10, 1940.

Rehearing Denied November 7, 1940.

Appeal from District Court, Cass County; R. H. Harvey, Judge.

Action to construe an oil and gas lease by Elbert Parker and others against George E. Parker and others. From a judgment for the plaintiffs, defendants appeal.

Affirmed.

Carney & Carney and Tom N. Cope, both of Atlanta, Green & Farmer, of Tulsa, Okl., and Smitherman & Smitherman, of Shreveport, La., for appellants.

Bartlett & Patman, of Linden, for appellees.

CODY, Justice.

This is a case of first impression in this State, in so far as it involves the question of whether, where parties own different tracts of land which are continguous and lease them in all respects as though they were a single tract owned by the lessors in common, said lessors thereby pool their interest so that they will share pro rata in the royalty no matter from which land oil is produced.

On June 25, 1935, George E. Parker and wife, Mamie W.; Willie Parker and wife, Lelia May; Mrs. Elizabeth P. McGee and husband, Edwin; Erbert Parker; Mrs. Willie Squyers and husband, R. C. Squyers, executed an oil and gas lease to Jones & Ferguson covering 244 acres of land in Cass County, Texas, for the cash consideration of $3,050. The land was described as a single tract of land, and the lease provided for the payment of royalty to each lessor in the proportion that his ownership bore to the whole 244 acres. We subjoin to our opinion a copy of the lease (omitting the acknowledgments).

In point of fact appellees, who were plaintiffs below, owned a tract of 66 acres, and the remaining Parker heirs owned a tract of 178 acres; and these two tracts formed the 244 acres which was covered by the lease, as before stated.

In June, 1936, the lessees paid the rentals in lieu of the drilling obligations to keep the lease in force. And thereafter the lessees, Jones & Ferguson, assigned a certain 80 acres, which constituted a part of the George E. Parker et al. 178 acres, to Bay Oil Corporation, who drilled thereon and brought in a producing well.

Subsequent to the completion of the discovery well, Jones & Ferguson (lessees) assigned all the remainder of the lease to the Ray Drilling Company, which completed three producing wells on the 178-acre tract; and no wells have ever been drilled on the 66-acre tract.

In June, 1937, the Ray Drilling Company tendered to the credit of appellees rental on the 66 acres in lieu of performing drilling obligations. In this connection a special issue was submitted to the jury, the answer of which will be found to dispose of any question which such action might be considered to have raised.

Appellees, as plaintiffs, brought this suit to have the court construe the lease as a "unitized" or pool lease, and to be declared the owners of 66/244ths of the one-eighth royalty provided for by the lease. Appellees further allege that appellee, Erbert Parker, was a half brother of the owners of the 178 acres, and that he and they had always been friendly in their dealings, and that it was mutually understood by the parties to the lease at the time it was executed that production on any part of the 244 acres should inure to the benefit of all so that all lessors should participate in the royalty from production had from any part of the 244 acres, and in the alternative pled that if the lease as drawn was insufficient to effectuate the intention of the parties to make of the lease a "unitized" one, that said lease be reformed, etc.

In response to special issues the jury found:

1. That the parties who signed the lease, prior to and at the time of signing it, had orally agreed that the lease was to be considered a unitized lease.

2. That Mrs. Willie Adcock (one of the appellees owning the 66 acres), after the discovery of oil, received and accepted delay rentals at the rate of a dollar an acre on her interest in the 66-acre tract, set apart to her and her son by partition in 1918.

3. That appellee, Erbert Parker, after the discovery of oil did not receive and accept delay rentals at the rate of a dollar an acre on his interest in the 66-acre tract set apart to him and his mother in the partition in 1918.

4. That Erbert Parker and Mrs. Willie Adcock, appellees, did not fail to claim any royalty from the lessee or the lessee's assigns before the drilling of the well drilled subsequent to the discovery well.

The court rendered judgment for appellees that they owned 66/244ths of the one-eighth royalty from the whole 244-acre tract covered by the lease in question.

The primary question here involved was passed on by the Supreme Court of West Virginia in South Penn. Oil Co. v. Snodgrass, 71 W.Va. 438, 76 S.E. 961, 963, 43 L.R.A.,N.S., 848, where it was held that an oil and gas lease executed by three several owners of contiguous lands, embracing which said lands described the demised premises as a single tract, contemplating a single well as a condition of its continuance, providing for payment of delay money to them jointly and, otherwise, treating them as tenants in common, is a joint lease of a single tract of land. In the opinion the court said: "Nowhere in the lease is there an intimation of several ownerships of parts of it, or a suggestion of intent to make separate tenancies. The proviso is for `a well,' not wells, `on the said premises' * * *. The clause providing for extension of the lease beyond the 10-year [i. e. primary] term requires only production of oil or gas thereafter, without any stipulation for production from more than one place or any particular place."

Again the court said: "We perceive no legal obstacle to a combination of several tracts of land, owned by different persons, into a lease as a single tract, since the lessors can apportion the rental among themselves in amounts corresponding with their interests, and we have decided that it can be done." The holding is sound. In the instant case the lessee was bound to pay a one-eighth royalty to "lessor", and the "lessor" in the lease consisted of several owners. The Supreme Court of Louisiana has reached the same conclusion. Nabors v. Producers' Oil Co., 140 La. 985, 74 So. 527, L.R.A. 1917D, 1115. In the case just referred to the court held: A mining lease whereby several lessors or grantors dispose of the mineral rights on several tracts of land for a gross price, without stating the amount paid to each grantor and without stating or designating the area of land belonging to each grantor, creates a joint obligation. And "The language of the instrument leaves no doubt that their contract was joint and not severable. For example, the contract declares that lessees [lessors] are to be `hereinafter styled grantor, whether one or more.'" The holding by the Supreme Court of California is in accord with that of Louisiana and West Virginia. Higgins v. California Oil & Asphalt Co., 109 Cal. 304, 41 P. 1087. See, also, Campbell v. Lynch, 81 W.Va. 374, 94 S.E. 739, L.R.A. 1918B, 1070. It is true that the Court of Appeals of Louisiana has expressed a different view from that of its own Supreme Court. United Gas Public Service Company v. Eaton, La.App., 153 So. 702, 709. But this opinion is by the intermediate court, not by the Supreme Court of Louisiana, and its force is weakened by the dissent of Mills, J. In his dissenting opinion he points out that, under the case of Nabors v. Producers' Oil Co., supra, the lease there in question is a joint or entire lease and not severable. He says, "Why should this lease, which contains no suggestion of separation of interest in the description of the land or terms, be held a joint lease as to everything except its very essence [,] development? The view adopted in the majority opinion does not make of it a gambling proposition, as suggested, but on the other hand invests the lessees with the sole power to determine whose land they will develop and which one of the joint lessors will receive the whole consideration for the lease to the exclusion of joint lessors. * * * I cannot conclude from the terms of the lease that any such condition was contemplated. On the other hand, it seems reasonable to me that the intention was that all the joint lessors should share proportionately in the consideration realized from the joint venture. To me, the best indication that the lease was intended to be joint is that the lessors entered into a joint and not a separate lease." We have not at hand the means of determining whether this case ever reached the Supreme Court. In any case, the opinion of Judge Mills is correct...