Pauline Oil & Gas Co. v. Fischer
| Decision Date | 10 January 1939 |
| Docket Number | 27931. |
| Citation | 90 P.2d 411,185 Okla. 108,1939 OK 7 |
| Parties | PAULINE OIL & GAS CO. v. FISCHER. |
| Court | Oklahoma Supreme Court |
Rehearing Denied April 4, 1939.
Application for Leave to File Second Petition for Rehearing Denied May 16, 1939.
Syllabus by the Court.
1. When an Industrial Commission award in favor of an injured workman remains unpaid, and a lien is claimed pursuant to section 13373, O.S.1931, 85 Okl.St.Ann. § 49; and to enforce payment the award is entered on the judgment docket of the District Court pursuant to section 13366, O.S.1931, 85 Okl.St.Ann. § 42, the award then "shall have the same force and be subject to the same law as judgments of the District Court," and thereby a lien, equivalent to a judgment lien, is impressed upon all of the property of the judgment debtor which would be subject to the lien of an original district court judgment, but property of the judgment debtor which would not be subject to judgment lien upon an original district court judgment, is not affected by such filing and entering of record of such award.
2. While an oil and gas lease which "grants, leases, and lets" certain land for oil and gas maining purposes conveys to the lessee an estate in the realty described therein, such interest is not real estate within the meaning of section 690, C.O.S.1921, 12 Okl.St.Ann. § 706, which gives a judgment creditor a lien upon the "real estate" belonging to the judgment debtor.
3. A lien upon property obtained by issuance and levy of execution out of the state court, in less than four months preceding the filing in federal court of a bankruptcy petition by the judgment debtor who is insolvent, is nullified by the adjudication of bankruptcy, and a subsequent sheriff's sale on such execution passes no title to the purchaser.
4. A plaintiff seeking to quiet title and recover an oil and gas leasehold estate in lands, and certain materials, machinery tools and appliances thereon, must recover, if at all, on the strength of his own title; and if his title is based on purchase at sheriff's sale on execution nullified by the intervening bankruptcy of the judgment debtor, then such plaintiff has no title and cannot recover.
Appeal from District Court, Pawnee County; Thurman S. Hurst, Judge.
Action by Abe Fischer against the Pauline Oil Company to quiet title to an oil and gas lease, to recover materials, machinery, tools, and appliances thereon, and possession of premises covered by the lease, and for damages. From a judgment in favor of the plaintiff, the defendant appeals.
Judgment reversed and cause remanded, with directions to enter judgment denying plaintiff any relief.
T. G. Chambers and James R. Eagleton, both of Oklahoma City, for plaintiff in error.
Hunt & Eagleton, of Tulsa, and Horace D. Ballaine, of Cleveland, for defendant in error.
Abe Fischer, defendant in error, hereinafter referred to as plaintiff, commenced this action in the district court of Pawnee county against the Pauline Oil & Gas Company, a corporation, plaintiff in error, hereinafter referred to as defendant, to quiet title to an oil and gas lease, to recover materials, machinery, tools and appliances thereon, and possession of the premises covered by the lease, and for damages. Judgment was for the plaintiff, and defendant brings appeal.
The plaintiff's claim of title is based upon a conveyance from the sheriff following a sale under execution growing out of an award of the Industrial Commission against the Geraldine Oil Company. The defendant's claim of title is based upon a conveyance from a trustee for the benefit of creditors, following an assignment to said trustee by the Geraldine Oil Company.
On August 30, 1934, the Industrial Commission granted an award to Sam Rainbolt against J. W. Snyder, employer, and the Geraldine Oil Company, the owner of the property involved, which company was secondarily liable for the award. On October 11, 1934, the Geraldine Oil Company made an assignment of the property to a trustee for the benefit of creditors.
On December 8, 1934, the award of the Industrial Commission in favor of Sam Rainbolt was filed of record in the district court of Pawnee County.
On January 21, 1935, sale was made by the aforesaid trustee of the property involved herein to the defendant.
On September 13, 1935, execution was issued on the judgment in favor of Sam Rainbolt by virtue of the award obtained in the Industrial Commission, said execution out of the district court being directed to the properties of the Geraldine Oil Company; and on September 17, 1935, levy was made under said execution on the property involved herein.
On October 24, 1935, upon its voluntary petition, the Geraldine Oil Company was adjudged bankrupt in the United States District Court.
On November 12, 1935, sheriff's sale was made of the property involved, pursuant to the execution and levy aforementioned; and following confirmation of said sale on June 10, 1936, sheriff's deed was issued to the purchaser, the plaintiff herein. On June 4, 1936, the United States District Court approved and confirmed the sale of said property made by the trustee for the benefit of creditors to the defendant on January 21, 1935.
Upon the pleadings, and after the introduction of all the evidence, the trial court directed a verdict for the plaintiff and assigned as his reason therefor that the judgment of the Industrial Commission constituted a lien upon all the property of the Geraldine Oil Company and that said lien was not destroyed by either the assignment for the benefit of creditors nor by the subsequent bankruptcy proceedings.
Since the right of plaintiff to recover depends on the strength of his own title, and since his title is assailed, we should first test the validity thereof.
It is plaintiff's theory that by purchase at the sheriff's sale he obtained title superior to the title of the former purchaser at the trustee's sale, and that although the levy on the property, as on execution, was in less than four months of bankruptcy, and the sheriff's sale was some weeks after bankruptcy, that his title was unaffected thereby. This theory is founded upon plaintiff's contention that a lien in favor of the judgment creditor existed prior to the assignment for the benefit of creditors, and that such lien continued in full force until the sheriff's sale and confirmation of sale, and that such lien was unaffected by anything that intervened. If that theory is sound the plaintiff rightfully recovered.
Upon the other hand, it is contended against plaintiff's title that no lien in favor of the judgment creditor had attached in October, 1934, when the property assignment for the benefit of creditors was made, nor even in January, 1935, when the trustee for creditors sold the property to the defendant. It is also asserted against plaintiff's title that since the sheriff's execution levy on the property was made in less than four months of bankruptcy, that the same was void by virtue of section 67, subdivision (f) of the Bankruptcy Act of 1898, as amended by Act June 7, 1934, § 5, 11 U.S.C.A. § 107(f), which in material part provides as follows: "That all levies * * * or other liens, obtained through legal proceedings against a person who is insolvent, at any time within four months prior to the filing of a petition in bankruptcy against him, * * * shall be deemed null and void in case he is adjudged a bankrupt, and the property affected by the levy * * * shall be deemed wholly discharged and released from the same. * * *" And if either of those contentions or theories is correct the plaintiff cannot prevail.
The federal court in approving the sale theretofore made to the defendant by the trustee for creditors, seems to have proceeded upon the theory that the filing of the judgment for...
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