Piney Oil & Gas Co. v. Scott

Citation258 Ky. 51,79 S.W.2d 394
PartiesPINEY OIL & GAS CO. v. SCOTT et al.
Decision Date02 November 1934
CourtCourt of Appeals of Kentucky

Rehearing Denied March 22, 1935.

Appeal from Circuit Court, Floyd County.

Action by the Piney Oil & Gas Company and others against Katherine Scott and others. From an adverse judgment, named plaintiff appeals.

Reversed with directions.

Combs &amp Combs, of Prestonsburg, and T. H. Harman, of Pikeville, for appellant.

W. A Daugherty, of Pikeville, for appellee.

DRURY Commissioner.

Piney Oil & Gas Company, H. Langdon Laws, and Stuart B. Sutphin, for the purpose of quieting their title to the minerals, oils, gases, and certain rights of way in and appurtenant to what we call the "Gearheart Land" in Floyd county and to obtain injunctive relief against interference with their exploitation and enjoyment thereof, on August 31, 1931, filed its petition in equity against Katherine Scott and 51 others. Their petition was dismissed, the defendants were adjudged to be the owners of the minerals to which plaintiffs had asserted title, and the plaintiffs have appealed.

On December 16, 1859, Valentine Gearheart and wife conveyed to James H. Laws the minerals underlying and appurtenant to a particularly described tract supposed to be 800 acres or more in Floyd county, and on December 24, 1859, after due acknowledgment, this deed was recorded in the proper office.

No right of any kind was by this deed left in the grantor to use or enjoy these minerals in any way. Valentine Gearheart continued to occupy and reside upon the surface of this tract, and it appears that neither he nor any of the defendants ever took that deed very seriously, for upon March 20, 1880, he conveyed 40 acres of this tract to Judith Hutton without making any exception of the minerals he had conveyed to Laws. He continued to live upon the tract until his death in 1881, and his widow resided there until her death in 1900, whereupon his son, Johnathan Gearheart, following in the footsteps of his father, on august 27, 1900, conveyed to Ned Gearheart the one-third of this tract which he Johnathan had inherited from his father, by a deed containing a clause of general warranty, without making any exception for the minerals conveyed to Laws. On February 26, 1901, Ned Gearheart, Polly Mead (née Gearheart), and Sallie Crabtree (née Gearheart) executed partition deeds among themselves, which also contained clauses of general warranty, but no exceptions of the minerals, and that is true of all the divers deeds subsequently made by them and their vendees and appearing in this record. They and their vendees have also between 1895 and 1920 executed a number of oil and gas leases that appear in this record with like warranties of title but without exceptions for the minerals previously conveyed to Laws. The evidence indicates, however, these leases were soon abandoned and no drilling ever done under them, due, probably, to the discovery of the deed to Laws when the titles were examined.

On July 20, 1905 a general warranty deed without exception of the minerals was made by Sallie Crabtree et al. to L. Dow Scott for 40 acres of this land, and on May 28, 1913, he filed suit against Harry L. Laws, the only son and heir of James H. Laws, to quiet the title Scott asserted to the minerals under that 40 acres. That litigation reached this court and resulted adversely to Scott, as will be seen by reference to Scott v. Laws, 185 Ky. 440, 215 S.W. 81, 13 A.L.R. 369.

The record of that suit was made a part of this one both by pleading and by introduction in evidence.

In that suit Scott had asserted an adverse possession by himself and his grantors of both 15 years and 30 years, and had in his pleading alleged: "He and those under whom he claims have at different times in each year mined and carried away large quantities of coal and have denied the right of all the world to mine thereon, have mined said quantities of coal to the exclusion of all the world to mine thereon, have mined said quantities of coal to the exclusion of all the world and have so mined same openly, notoriously, adversely and peaceably and have at all times during said period claimed the whole of said tract of land including the coal and mineral thereunder as their own." George Mead, one of the defendants in this case, admits he contributed money to aid Scott in the prosecution of that old case, and, after the mandate was filed the court on February 10, 1920, entered a judgment quieting the title of Laws and describing with meticulosity the entire tract which had by survey been found to contain 962.8 acres.

The testimony in this case shows that old suit was intended as a test suit, but, as the test proved to be unfavorable to the surface owners, they elected to not abide by it, or, as Mr. George Mead says in his testimony in this case in answer to why he and others did not sue to quiet their title at that time: "We just thought there would be no use for anyone else to sue; that would look reasonable but we didn't get a square deal as we considered it and we never was satisfied with the decision of the court, of the Circuit Court of the Court of Appeals and we looked all the while for this opening we have now."

As to Geo. Mead, who admits participation in that suit by contributing to the attorney's fees and all claiming under him, and as to Katherine Scott and other defendants who claim under L. Dow Scott, the judgment entered on February 10, 1920, is conclusive, for in Bridges v. McAlister, 106 Ky. 791, 51 S.W. 603, 605, 21 Ky. Law Rep. 428, 45 L.R.A. 800, 90 Am.St.Rep. 267, we said: "Neither the benefits of judgments on the one side nor the obligations on the other are limited exclusively to parties and their privies. *** There is a numerous and important class of persons who, being neither parties upon the record nor acquirers of interest from those parties after the commencement of the suit, are nevertheless bound by the judgment. Prominent among those are persons on whose behalf and under whose direction the suit is prosecuted or defended in the name of some other person."

Now to return to the other defendants. All the defendants were not sued originally, and some were brought in by an amended petition, and hence there are two answers in the record, one filed by the group first sued, the other by the group brought in by the amended petition. These answers are essentially the same. Each consists of four paragraphs; the first is a denial; the second a plea of 15 years of adverse possession; the third a plea of 30 years' adverse possession; and the fourth is a plea that, at the time plaintiffs acquired their title, the defendants were in adverse possession of this mineral estate, and that hence the title of plaintiffs is champertous and void. All of this was put in issue by reply.

H. Langdon Laws and Stuart B. Sutphin acquired their interests in the premises by deed dated December 31, 1919, and the Piney Oil & Gas Company acquired its interests from them by lease dated August 9, 1929.

Possession by Surface Owners.

After the deed from Valentine Gearheart to Laws had been recorded in the proper office, it brought home to all the world and to each of these defendants notice of the ownership by Laws of the minerals appurtenant to this "Gearheart Land" just as fully as if Laws had a notice of his ownership with a copy of this deed attached served upon each of these defendants by the sheriff and caused such copy to be read to them by him in the presence of witnesses. Cherry Bros. v. T. C. Ry. Co., 222 Ky. 79, 299 S.W. 1099.

From and after the recording of that deed, Valentine Gearheart, as the owner of the surface and all of these defendants claiming under him, became, were, and have remained trustees for Laws and those claiming under him. "The owner of the surface is regarded as trustee, in possession of the mineral for the use and benefit of its real owner, and he cannot acquire title by adverse possession to the mineral estate except in the way and manner which a trustee of other real property may acquire title against the cestui que trust. He is subject to all the rules controlling other trustees in possession." McPherson v. Thompson, 203 Ky. 35, 261 S.W. 853, 854; to same effect see Eli v. Trent, 195 Ky. 26, 241 S.W. 324; Foxwell v. Justice, 191 Ky. 749, 231 S.W. 509; Farnsworth v. Barrett, 146 Ky. 556, 142 S.W. 1049; Asher v. Gibson, 198 Ky. 285, 248 S.W. 862; Franklin Fluorspar Co. v. Hosick, 239 Ky. 454, 39 S.W.2d 665. Being trustees in possession, Valentine Gearheart and these defendants holding this surface under him could never, no matter how long they held this surface, by that possession disseise Laws and those claiming these minerals under him. See C.J. p. 907, § 447; 65 C.J. p. 531, § 278; Ky. Stats. § 2366a-1. Being trustees in possession, they could not while that relation continued ever be in adverse possession of these minerals. A trustee in possession while such can never acquire title to the property of his cestui que trust by any length of possession, for his possession never becomes adverse. See Elliott v. Louisville, 123 Ky. 278, 90 S.W. 990, 28 Ky. Law Rep. 967; Green v. Otter, 3 B. Mon. (42 Ky.) 102; Spicer v. Holbrook, 66 S.W. 180, 23 Ky. Law Rep. 1812; 65 C.J. p. 531, § 278. So long as these surface holders occupy the position of trustee in possession, their mining of coal on this land from time to time can never become such an adverse use and occupation as to amount to adverse possession. To acquire such a possession, they would have to openly disavow or repudiate the trust and give to the owner of this mineral estate notice thereof, or as said in Houser v. Christian, 108 Ga. 469, 34 S.E. 126, 75 Am.St.Rep. 72: "We think that the grantees in a deed which reserved...

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