Rowe v. Chesapeake Mineral Co.

• Decision Date: 08 July 1946
• Docket Number: No. 10094.,10094.
• Citation: 156 F.2d 752
• Parties: ROWE et al. v. CHESAPEAKE MINERAL CO.
• Court: U.S. Court of Appeals — Sixth Circuit

156 F.2d 752 (1946)

ROWE et al. v. CHESAPEAKE MINERAL CO.

No. 10094.

Circuit Court of Appeals, Sixth Circuit.

July 8, 1946.

O. T. Hinton, of Pikeville, Ky. (O. T. Hinton, of Pikeville, Ky., on the brief), for appellant.

LeWright Browning, of Ashland, Ky. (LeWright Browning, of Ashland, Ky., on the brief), for appellee.

Before HICKS, ALLEN, and MARTIN, Circuit Judges.

ALLEN, Circuit Judge.

This is an action to quiet title to the rights in oil and gas in some 1,100 acres of land situated in Pike County, Kentucky. Both appellants and appellees claim title by mesne conveyances under a deed executed October 14, 1887, by William H. Reynolds, Orlando Reynolds, Andrew Adkins, and their wives. The deed was one of a number submitted to various grantors on printed forms which in the granting, habendum and warranty clauses contained the words "coal, salt water, oil, gas and mineral." In this deed (hereinafter called the Reynolds deed), a line had been drawn through the words "salt water, oil, gas" and the granting clause, with the words deleted, read: "the said parties of the first part do hereby sell and convey to the said party of the second part all the coal, and mineral lying and upon and under our farm * * *."

The habendum clause read: "to have and to hold unto the party of the second part, his heirs and assigns forever, with the right of said John J. Stuart, Trustee, his heirs and assigns, of entry to mine said coal, and mineral, with all the usual mining privileges reserving to ourselves the fee simple ot the surface of said farm, and the right to mine coal therein for our household use."

The warranty clause read: "The parties of the first part warrant generally the title to the coal and mineral hereby sold. * * *"

When the deed was lodged for record in the office of the clerk of Pike County, the clerk did not record the deletion, so that the words "coal and mineral" or "coal, and mineral" appeared as above set forth as if this was the original draft.

The District Court found that in striking out the words "salt water, oil, and gas" the grantors expressly intended to reserve their rights in salt water, oil and gas; but it held that the appellees, as innocent purchasers for value without notice, were entitled to rely upon the record; and since the grantors put the deed into circulation, the appellants who claim under them must bear the burden of the grantors' negligence. The court therefore denied the relief sought, upon the ground of estoppel.

The appellee clearly had no notice of the deletion, for the conveyance of the mineral rights to it was made on June 27, 1907, and it is uncontradicted that neither the appellee nor its predecessor, the Chesapeake & Ohio Railway Company of Kentucky, ever had possession of the Reynolds deed until August 10, 1933. The appellants, on the other hand, claim under six deeds, all executed by appellant Rowe's immediate predecessors in August or September, 1941, one of them, at least, a quit-claim deed. The Reynolds deed was recorded in November, 1887, and the deed from the Chesapeake & Ohio Railway Company to the appellee was recorded on August 13, 1907. The latter deed conveyed "all the coal and other minerals, gases, salt waters and oil in, upon and under" the land described including the land covered by the Reynolds deed. Appellants thus had notice of appellee's claim, so that on this issue the equities preponderate in favor of the appellee.

Appellants contend that the appellee is not a purchaser for value, because the only consideration for the conveyance was the building of a railroad for the grantor; but this obviously was a substantial benefit to the grantor and constituted valid consideration.

We think that the grantors in this case, assuming that they deleted the words in question, were not negligent. It was not their duty, under Kentucky law, to lodge the instrument for record. The recording was mainly a protection to the grantee. Section 29, c. 24, Kentucky General Statutes, 1883, in force in 1887, provided that the instruments which have been or may be recorded shall be delivered to the party entitled to the same. Section 14 of the same chapter contains the usual provision that unrecorded deeds are not good against creditors or purchasers for valuable consideration without notice. These statutes are in pari materia, and when read together, they show that in Kentucky the obligation of recording a deed does not rest upon the grantor, and hence the dereliction of the clerk, if such it was, in failing to copy the deleted words and to indicate the deletion, can in no way be charged to the grantor.

The circumstances accompanying the deletion are not shown. It was assumed by the District Court that the deletion was contemporaneous with the execution of the deed; but this does not appear, and who drew the line through the words "salt water, oil and gas" and for what purpose, is not explained in any way, except through the testimony of Orlando Reynolds, then ninety years old, who stated to a witness that he and his brother (William Reynolds) in the 1880's had sold the minerals and retained the surface. The case is hence strongly differentiated from Hudson & Collins v. McGuire, 188 Ky. 712, 223 S.W. 1101, 17 A.L.R. 148, and Rice v. Blanton, 232 Ky. 195, 22 S.W.2d 580, relied upon by appellants. In the Hudson & Collins case, the petition alleged that it was not intended by the parties to the deed that the oil and gas rights involved should be conveyed, and this was admitted by demurrer. In Rice v. Blanton, there was positive evidence that the deed originally included oil and gas, and that the grantor refused to sign it upon that ground until it was redrawn. It may be in the instant case that the words in question were deleted by some one who wished to eliminate verbiage, rather than for the...