Parker v. Rolls

• Decision Date: 27 July 1960
• Docket Number: No. 10768,10768
• Citation: 338 S.W.2d 523
• Parties: William A. PARKER, Appellant, v. Joe C. ROLLS, Appellee.
• Court: Texas Court of Appeals

Page 523

338 S.W.2d 523

William A. PARKER, Appellant, v. Joe C. ROLLS, Appellee.

No. 10768.

Court of Civil Appeals of Texas, Austin.

July 27, 1960.

After Remittitur Aug. 24, 1960.

Scurry, Scurry, Pace & Wood, Dallas, for appellant.

Grindstaff & Grindstaff, Ballinger, for appellee.

HUGHES, Justice.

Joe C. Rolls, appellee, sued William A. Parker for the sum of $1,212.50, interest and attorney's fees allegedly due under a contract executed by A. W. Smith allegedly as agent for appellant, Mr. Parker.

The contract was in the form of a letter addressed to: Mr. A. W. Smith, 111 Devonshire St., Boston, Mass. and Mr. Wm. A. Parker, 200 Berkeley St., Boston, Mass., dated March 5, 1954. The letter was signed by A. W. Smith and Joe C. Rolls and reads:

'From: Joe C. Rolls

'For a fee of one hundred dollars ($100.00) per month I agree to supervise production operations on leases and wells belonging to Wm. A. Parker, et al, located in Taylor County and Runnels County, Texas. Pumpers salary, car mileage, clerical and personal expenses will be borne by me. All well supplies and well servicing will be for your account. Any expense involving more than one hundred dollars ($100.00) will require your approval before same is incurred.

'I will prepare all monthly and annual reports required by the Railroad Commission of Texas and will submit to you a monthly production report giving pertinent production data for each well.

'I will supervise your production as diligently and economically as possible. I will not be liable for any unsatisfactory results which may occur from work-over operations and equipment failures.

'This agreement may be terminated by either of us upon two weeks' notice.

'If the above is satisfactory please sign and return one copy to me with date you desire same to become effective.

'/s/ A. W. Smith

/s/ Joe C. Rolls

'3/5/54'

Attached to appellee's pleading was a sworn account reciting the operation of three wells in Taylor County and two wells in Runnels County for the months from March, 1954 through December, 1954, inclusive, at $100 per month per well, or a total indebtedness of $5,000. Credits are shown commencing with April, 1954, and for each month thereafter through January, 1955, except for the month of September, 1954, totalling $3,787.55, leaving a balance due of $1,212.50.

Appellant filed a first amended answer in which was contained a general denial and a special answer from which we quote:

'II. The Defendant states that he has paid the Plaintiff promptly all sums of money due Plaintiff for services rendered to the Defendant in this connection. Defendant alleges that he was the owner of an undivided interest in oil and gas leases in certain wells and that in said wells Defendant states he was entitled only to a portion of the oil produced from said leases and that he has paid Plaintiff the sum of money due by him of his part ownership. Defendant alleges that Plaintiff knew that other parties owed undivided interest in some of these oil and gas leases, and, as a matter of fact, was working and associated with two (2) of such other owners named George Barrell and Robert Reiser, who are parties who owe Plaintiff part of the monies claimed in this suit.

'III. Defendant alleges further that said contract attached as Exhibit 'A' was not executed by him or anyone with authority to bind this Defendant to pay the debts of other owners of interests in the properties for which Plaintiff is claiming money due for work performed.'

The allegations as to the lack of authority of A. W. Smith were supported by affidavit.

This answer was filed February 7, 1959. Prior thereto, February 4, 1959, there was filed 'Defendant's First Supplemental Answer, supplementing his First Amended Answer.' In this answer appellant pleaded, solely, the two and four year statutes of limitation. Art. 5526 and Art. 5527, Vernon's Ann.Civ.St.

On October 1, 1959, appellant filed 'Defendant's Second Supplemental Answer, supplementing his First Amended Answer and First Supplemental Answer.' This answer pleaded, solely, the two and four year statutes of limitation.

By supplemental petition (called 'answer') appellee pleaded that appellant had ratified the acts of Smith and was estopped to deny his authority in the premises.

The case was submitted to a jury which made these findings:

(1) That Smith was acting for and in behalf of appellant when the Rolls-Smith contract was made.

(2) That appellant knew of such contract when he made payments to appellee in connection with the operation of the wells mentioned in such contract.

(3) That appellant was the operator of the wells mentioned in the contract.

(4) That appellant was the only interest owner of the wells mentioned in the contract who exercised authority over their operation.

(5) That appellee performed services for appellant as operator of the wells mentioned in the contract; that appellee had not been fully paid for such services, and that there was due him $1,212.50.

(6) Appellee sent statements for his services to Smith for the first two or three months of operation.

(7) Appellee knew that Robert Reiser believed he had an interest in the Taylor County wells when he paid part of the statement sent by appellee for March, 1954.

(8) That in March, 1954, Smith was not acting for his own benefit in connection with the operation of the wells.

(9) Appellee decided, after the first two or three months of operation to treat the contract as binding on appellant.

(10) Smith when he executed the contract was not acting for all the owners of the Taylor County leases.

(11) Appellant had knowledge of the contract signed by Smith prior to its termination.

Appellee moved for judgment on the verdict. Appellant moved for a mistrial on the ground that certain jury issues were conflicting, and that the Court erred in refusing to submit a requested special issue. He also moved for judgment not to exceed $131.25 and attorney's fees.

Judgment was entered for appellee for $1,212.50, interest at 6% per annum from February 1, 1955, and $400 attorney's fees.

Before proceeding to a discussion of the points of error made by appellant, we desire to notice the state of his pleadings. The two supplemental answers were not in response 'to the last preceding pleading' by appellee. Rule 69, Rules of Civil Procedure. The last preceding pleading by appellee on file when the first supplemental answer was filed was appellee's original petition to which appellant had on file his first amended answer.

When appellant's second supplemental petition was filed the last preceding pleading of appellee was his first supplemental petition (called answer) which pleaded ratification and estoppel to appellant's answer alleging lack of authority on the part of Smith. Obviously appellant's plea of limitation was not in response to this pleading.

If we do not consider either of these pleadings, then appellant is left without his plea of limitations.

If, as it has been held, ¹ a supplemental pleading may be considered as an amendment, then, under Rule 65, T.R.C.P., the amendment takes the place of the pleading for which it is substituted. This reasoning would leave appellant without his plea of want of authority of Smith to execute the contract sued upon.

Since appellee has not questioned these pleadings, we have concluded to dispose of appellant's points without regard to the sufficiency of the pleadings.

Appellant was the owner of the entire leasehold interest in two wells in Runnels County, and of an undivided interest in the leasehold, or working interest, in three wells in the Lawn Oil Field in Taylor County.

By undisputed evidence it was established that a custom exists in the oil business that where a lease is jointly operated, that is where the working interest (distinguished from royalty) is owned by various owners, one of the owners is designated as operator of the lease and 'that operator handles the properties as they were his own and in turn he bills his partners of their proportionate share,' the operator paying all bills and collecting from the other owners.

The appellant did not testify, nor did A. W. Smith who was deceased at the time of trial.

On February 9, 1954, appellee wrote a Mr. George H. Barrell stating the terms upon which he would operate for Mr. Robert Reiser et al. and Mr. William A. Parker et al. in the Lawn and Cree-Sykes Fields, a copy of this letter being sent to A W. Smith.

On February 16, 1954, A. W. Smith wrote appellee that he 'As the representative of Mr. Wm. A. Parker' authorized him to operate 'Mr. Parker's wells in Runnels County as well as his interests in the Lawn Field,' the terms to be as stated in the February 9th letter.

On March 5, 1954, the letter (contract) previously copied was sent to appellant.

On April 4, 1954, appellee sent to appellant in care of A. W. Smith in Boston a bill for $500 for operation of the wells mentioned in the contract of March 5, 1954, a copy of the bill being sent to A. W. Smith. Of this amount $100 was paid appellee by Robert Reiser and appellant paid him, by check, $368.75. Appellant paid nine other similar amounts monthly to appellee on statements sent by him to A. W. Smith or directly to appellant. Mr. Reiser did not pay more than a total of $200 during this period, the evidence showing that he stopped paying because of title troubles over his interests in the wells.

On March 16, 1954, appellee wrote appellant as follows:

'Mr. Wm. A. Parker

'200 Berkeley Street

'Boston 16, Mass.

'Dear Mr. Parker:

'Since I was unable to contract Mr. Smith today, I am writing you for clarification of details regarding operations on your wells in Units M, T, and W, Lawn Townsite, and your Burrus No. 1 and Brown No. 1, Cree-Sykes Field.

'Needless to say, your credit rating with all the oil field supply houses is A-1; however, for your own benefit I have to know whether you, as operator, are responsible for operating costs, both...