Rio Bravo Oil Co. v. Staley Oil Co., 14035.

• Decision Date: 01 March 1940
• Docket Number: No. 14035.,14035.
• Citation: 138 S.W.2d 838
• Parties: RIO BRAVO OIL CO. v. STALEY OIL CO. et al.
• Court: Texas Court of Appeals

138 S.W.2d 838

RIO BRAVO OIL CO. v. STALEY OIL CO. et al.

No. 14035.

Court of Civil Appeals of Texas. Fort Worth.

March 1, 1940.

Rehearing Denied April 5, 1940.

Appeal from District Court, Wichita County; Allan D. Montgomery, Judge.

Suit by the Staley Oil Company against the Rio Bravo Oil Company to recover a part of the mineral estate in certain tract of land, wherein M. L. Banta intervened and wherein defendant filed a demurrer. From an adverse judgment, defendant appeals.

Affirmed.

Bullington, Humphrey & Humphrey and Frank Ikard, all of Wichita Falls, for appellant.

McDonald & Anderson, T. R. Boone, and Charles C. McDugald, all of Wichita Falls, for appellees.

DUNKLIN, Chief Justice.

This suit was instituted by the Staley Oil Company on June 20th, 1938, against the defendant, Rio Bravo Oil Company, to recover 7/8 ths of the mineral estate in 120 acres, out of the S. W. 1/4 th of Survey No. 33, Block No. 7, H. & T. C. Ry. Co. Survey, in Wichita County. There were two counts in plaintiff's petition: the first in the statutory form of trespass to try title; the second was a claim of title by statutes of limitation of 3, 5, 10 and 25 years, Vernon's Ann.Civ.St. arts. 5507, 5509, 5510, 5519. With a further plea of laches and stale demand and estoppel, by reason of plaintiff's adverse possession of 55 years and abandonment by defendant of any claim of title. Plaintiff further pleaded that it was a bona fide purchaser for a valuable consideration, without notice of the unrecorded muniments of title under which defendant was claiming title.

M. L. Banta filed a plea of intervention, in which he sought a recovery of defendant, for all the mineral estate in the entire 160-acre tract not sued for by plaintiff, and also for title to the surface estate. His plea was substantially the same as in plaintiff's petition.

The defendant answered the suits of both plaintiff and intervener, by general demurrer, general denial, plea of not guilty and a special plea of claim of title in the minerals in and under the said southwest quarter of section 33, block 7, H. & T. C. Ry. Co. Survey, including 160 acres, with incidental right of ingress and egress over the surface of the land, and all other privileges and reservations, including the minerals, retained by the Houston & Texas Central Railway Company in its contracts with James H. Banta, of date August 1st, 1882, conveying to him said quarter section, but disclaiming title to the surface estate thereof.

All parties prayed for removal of claims of their adversaries, as clouds upon their respective titles.

The case was tried to a jury, and following is the documentary evidence on which plaintiff and intervener relied for recovery, additional to evidence hereinafter noted to support title by limitation.

Plaintiff's Exhibit No. 7: deed of trust by the Houston & Texas Central Railway Company, dated July 1st, 1866, by the terms of which it conveyed to Shepherd Knapp and David S. Dodge, trustees, and their successors in trust, ten sections of 1,024 acres per mile of railway it would construct, and which included the land to be acquired by the Railway Company, now in controversy, under an Act of the Legislature passed March 11th, 1848, and later Acts supplemental thereto, including an Act approved January 30th, 1854, entitled "An Act to Encourage the Construction of Railroads in Texas, by donation of lands." It was recited in that instrument that it was given to secure payment of certain bonds the Railway Company would issue to procure money with which to pay for construction of its railway and for equipment with which to operate it. It was stipulated that after the Railway Company had surveyed and located the land covered by the lien, it would furnish to the trustees schedules and descriptions thereof, and affixed thereto minimum prices for which they are to be sold, with affidavits of the president and secretary of the Railway Company that such minimum prices are fair, the aggregate amount of which to be sufficient to liquidate the aggregate of the bonds to be issued; and the trustees would also reappraise said lands and affix minimum prices thereof in the same manner as the Railway Company has done, and with the same force and effect. With these further provisions:

"And whenever said Railway Company shall certify in writing to said Trustee that it has contracted for the sale of any section or parcel of said lands at a sum not less than the minimum price affixed to the same and ten per cent at least of the consideration shall be paid to the Trustees and a bond and mortgage of the consideration shall be paid upon the premises contracted to be sold in proper form from the purchaser to the Trustee securing the residue of the consideration money with the interest thereon as hereinafter mentioned shall be delivered to the Trustees such mortgage having been first duly acknowledged and recorded, the said Trustees will thereupon make, execute and acknowledge a deed conveying to such purchaser, his heirs and assigns, all the rights, title, interest, estate and property of the said Trustee of, in and to the section or parcel of land so sold with a covenant that they have not done any act, matter or thing to defeat or prejudice their title to the lands so conveyed. Provided that in all cases the true consideration or price of the land shall be set forth in the conveyance and shall in no case except as hereinafter provided be less than the minimum price affixed to the same as aforesaid * * *."

It was further stipulated that in event of default in payment of bonds, the trustees would be empowered to sell the lands then on hand, to satisfy such obligations, and convey same to the purchasers by deeds with general warranty of title.

Plaintiff's Exhibit No. 1: patent from the State of Texas, of date July 5th, 1867, to the Houston & Texas Central Railway Company, to the S. W. quarter of section 33, block 7, H. & T. C. Ry. Co. Survey, in Wichita County; filed for record in Deed Records of Wichita County, March 14th, 1910.

Plaintiff's Exhibits Nos. 2 and 3: two oil and gas leases in the usual and customary form, dated September 25th, 1937, and filed for record in the Deed Records of Wichita County, November 3rd, 1937, from M. L. Banta and wife, Jimmie Banta, Mrs. R. C. Pinkerton, a widow, and E. L. Chilton and wife, Estelle Chilton, D. R. Preston and wife, Brown Eyes Preston, Mrs. Irene Preston, individually and as community administratrix of the estate of herself and T. E. Preston, deceased; Rado Bradley, wife of R. J. Bradley, Mary Lee Walker, wife of M. T. Walker, Zora Cunningham, wife of G. E. Cunningham, M. L. Pinkerton, E. L. Chilton, by R. J. Bradley, attorney in fact, to plaintiff, Staley Oil Company, covering the southwest one-fourth of section 33, block 7, H. & T. C. Ry. Co. Survey, Wichita County. Those leases were for a period of ten years, upon conditions stated. The recited consideration in each was ten dollars cash in hand paid and covenants and agreements of the lessee to pay to lessors one-eighth of oil and gas produced, with privilege of lessee to avoid a termination of the leases by paying a rental of $1 per acre, at the end of any preceding year.

Uncontradicted testimony of M. L. Banta, introduced as a witness by plaintiff, to the following facts, to-wit: in the year 1885, James H. Banta built a residence house upon the 160-acre tract in controversy, and enclosed the same with a fence. During the same year, he moved upon it with his family, put 40 acres in cultivation and used the remainder for pasturage of his stock. He continued that occupancy and use, and paid taxes on the land, from 1885 to the year of 1916, when he died. Throughout that period his possession of the surface estate has been peaceable and adverse. When he died, he left surviving him six children, and witness was one of them. Witness then went into possession and ever since and up to September 25th, 1937, the date of plaintiff's oil and gas leases, he has been in peaceable and adverse possession of the surface estate, occupying the residence thereon, cultivating the 40 acres and using the remainder for pasturage purposes, just as his father had done, and has paid taxes thereon. During his possession of the land, James H. Banta executed oil and gas leases on portions of the 160-acre tract to different persons; one dated April 6th, 1909, to D. C. Green; one to Fred S. Rowe, of date August 10th, 1911; one to Frank Cullinan, dated January 17th, 1913; also a deed to A. N. Treece, of date January 28th, 1913, but the land was reconveyed to J. H. Banta by Treece, on the same date. After the death of J. H. Banta, his heirs executed deeds one to another of their respective interests in the land, which they had inherited from him, those deeds being of divers dates between the year 1916 and 1920. On July 22nd, 1922, some of them executed an oil and gas lease to The Texas Company on a portion of the tract, and on September 7th, 1927, several executed a deed of partition of the tract between themselves. All of the instruments noted above, including those executed by J. H. Banta and by his heirs, were filed and recorded in the Deed Records of Wichita County, soon after their execution. But no possession of the minerals was acquired under any of those instruments, by drilling oil wells. Nor has any drilling been done for oil or gas by any one else.

In the year 1924, witness sold gravel from this land to the Austin Bridge Company, who mined it by use of shovels, for a period of six months, and paid witness $900 for the gravel removed.

Witness never heard of any adverse claim of the minerals in the land as against J. H. Banta during his lifetime, or in any manner since his death, until April 12th, 1938, when defendant recorded in the Deed Records of Wichita County the instruments under which they claim title in this suit.

No evidence was offered to show that plaintiff or any of the heirs of James H. Banta,...