Runge v. Moore, 8753

• Court: North Dakota Supreme Court
• Writing for the Court: TEIGEN; STRUTZ
• Citation: Runge v. Moore, 196 N.W.2d 87 (N.D. 1972)
• Decision Date: 28 March 1972
• Docket Number: No. 8753,8753
• Parties: Ralph H. RUNGE, General Guardian of the Person and Estate of Annie M. Bell, an incompetent, and Marvel Molm, Administratrix with the Will Annexed of the Estate of Elmer Bell, Deceased, Plaintiffs and Appellants, v. R. E. MOORE, Defendant and Respondent. Civ.

Page 87

196 N.W.2d 87

Ralph H. RUNGE, General Guardian of the Person and Estate of Annie M. Bell, an incompetent, and Marvel Molm Administratrix with the Will Annexed of the Estate of Elmer Bell, Deceased, Plaintiffs and Appellants, v. R. E. MOORE, Defendant and Respondent.

Civ. No. 8753.

Supreme Court of North Dakota.

March 28, 1972.

Syllabus by the Court

1. The record has been examined and it is held that there is no evidence to support the claim that the grantor of the mineral interest was induced to convey by duress, menace, fraud or undue influence.

2. The capacity of the grantor to execute a deed is his capacity at the time the deed is made and executed.

3. In determining incapacity of a grantor, such as to render his deed invalid, the court must be satisfied that the grantor was not in a situation to transact that particular business rationally. On the one hand, it is not necessary to show that he was capable of doing all kinds of business with judgment and discretion; nor, on the other hand, to show that he was wholly deprived of reason so as to be incapable of doing the most familiar and trifling work. His deed would be void if his mind and memory were in such a situation at the time of executing the deed as to render him wholly incompetent to judge of his rights and interests in relation to that transaction (Paragraph No. 2 of Syllabus, Lee v. Lee, 70 N.D. 79, 292 N.W. 124).

4. Where grantor, unable to write, signs deed by mark, and grantor's name appears near the mark and there were witnesses to the mark, the signature is valid.

Freed, Dynes & Malloy, Dickinson, for plaintiffs and appellants.

Greenwood, Murtha & Moench, Dickinson, for defendant and respondent.

TEIGEN, Justice.

The action upon which this appeal is premised is being prosecuted by the legal representatives of Annie M. Bell and Elmer Bell, her husband (now deceased). The action was instituted to rescind, cancel, set aside and have declared void two mineral deeds on the alleged ground that the grantors, Annie M. Bell and her husband, Elmer Bell, were induced by duress, menace, fraud and undue influence on the part of the named grantees in said mineral deeds, and others, to execute and deliver the deeds in question. Further, if the court should find that the grantors were not induced by duress, menace, fraud or undue influence to deliver said deeds, nevertheless, at the time of the delivery of said conveyances, Annie M. Bell, who was the sole owner of the mineral interests purportedly conveyed, was mentally incompetent and unable to understand the nature and extent of the transactions, or to understand and attend to her business affairs, and that, therefore, the attempted conveyances by Annie M. Bell were a nullity and void.

This action was commenced naming R. E. Moore and Albert Gatzke as defendants. It seeks to set aside and cancel two separate mineral deeds, one to each of said defendants.

The defendant Albert Gatzke, named as grantee in one of the mineral deeds described in the complaint, defaulted. Judgment of default has been entered as a separate judgment against this defendant, cancelling and setting aside the conveyance and directing the restoration to him of the consideration paid thereof. No appeal has been taken from that judgment.

The case against the defendant R. E. Moore was contested and tried to the court without a jury. The trial court found for the defendant Moore and against the plaintiffs. The plaintiffs thereupon moved for a new trial, which was denied, and this appeal is taken from the judgment and order denying a new trial. This appeal was taken prior to July 1971 and is here for review de novo.

Following entry of final judgment the attorneys, drawing post judgment papers, changed the title of the case by dropping the name of the defendant Gatzke from the title and, after the appeal had been taken, executed and filed in this cause a stipulation seeking a further change in the title of the case. It appears from the stipulation that one of the above-named incompetents, Elmer Bell, died on March 11, 1971, and that Marvel Molm was the administratrix of his estate; that it was the mutual desire of the parties to effect a substitution of parties prior to the submission of the case to this court. Therefore the parties stipulated that an order be issued by this court forthwith and without further notice substituting Marvel Molm as administratrix with the will annexed of the estate of Elmer Bell, deceased, as a party in this action in place of Ralph H. Runge, as general guardian of the person and estate of Elmer Bell, incompetent. Pursuant to said stipulation, this court, on September 9, 1971, by a majority of the judges, entered an order accordingly and the title of the case was changed to reflect the substitution.

We are concerned here with the judgment, after trial, as the same affects the defendant R. E. Moore. This judgment confirms and validates a mineral deed dated December 30, 1969, conveying an undivided one hundred mineral acres in Section 31, Township 137 North, Range 99 West of the Fifth Principal Meridian, Stark County, North Dakota, executed and delivered for a consideration of $8,500, which was paid.

Annie M. Bell was a schoolteacher when she met and married Elmer Bell, a farmer. After their marriage, in the early 1900's, they lived on a farm located south of Belfield, North Dakota, until about 1958 when they moved into Belfield. They had no children. The farm home was located on Section 32--137--99. This section belonged to Elmer. It is not in issue here. The adjoining section, being Section 31, which is in issue here, was owned by John Bell, Elmer's brother. In 1943 John Bell and his family moved to Ellendale, North Dakota. At that time John Bell sold Section 31 to Annie M. Bell, or at least title was taken in her name.

In 1958, when the Elmer Bells quit farming and moved into Belfield, they sold their farm land. Section 31 was sold to Ernest Nielsen and Section 32 was sold to Harvey Hewson. However, the Bells reserved all of the minerals underlying the land. Thus Nielsen and Hewson became surface owners only. The land was leased for oil and Elmer and Annie M. Bell paid one-half of the cash delayed rentals received from Section 31 to John Bell. It appears that these payments were so made for a number of years. It is explained that this was done for the reason that John Bell had intended to reserve minerals when he sold the land but, through inadvertence, no reservation was contained in the deed.

In October 1966 Annie M. Bell, having suffered a severe stroke which was followed by temporary hospitalization, was admitted to St. Luke's Nursing Home, located in Dickinson, North Dakota, where she still resides. Her husband continued to live in their home in Belfield.

It appears that oil exploration activity moved in the direction of the Bell land. In the fall of 1969 the first producing oil well was brought in on the Northeast Quarter of the Northeast Quarter of Section 36 in the adjoining township, which section joins Section 31 on the west. This well became a producer and is referred to in the record as 'Well No. 1'. The second well, in chronological order, was drilled northwest of the first well in Section 25 and turned out to be a dry hole. The third well was drilled in Section 31 (Annie M. Bell property). It was spudded in on November 25, 1969. The drilling activity in this area created considerable interest on the part of brokers and others in the purchase of mineral interests. It appears from the evidence that Elmer Bell was approached by several persons on various occasions to sell mineral interests in Section 31.

On October 1, 1969, Annie M. and Elmer Bell executed and delivered a mineral deed conveying a 240/640 (approximately 240 mineral acres) interest in Section 31 to John and Thelma Bell (husband and wife). Thelma Bell testified that the purpose of this conveyance was to carry out the intent of the parties in connection with the sale of Section 31 by John Bell to Annie M. Bell, which was to retain a percentage of the minerals in the 1943 conveyance.

On December 7, 1969, John Bell died.

On December 12, 1969, Annie M. and Elmer Bell conveyed an undivided ten mineral acres in Section 31 to the defendant Albert Gatzke for a consideration of $50 per mineral acre, or a total of $500. This mineral deed was cancelled by the judgment referred to in the early part of this opinion and the consideration which had been paid was restored.

On December 30, 1969, Annie M. and Elmer Bell conveyed an undivided one hundred mineral acres in Section 31 to the defendant R. E. Moore for a consideration of $85 per mineral acre, or a total of $8,500. This is the mineral deed under attack in this appeal which we will refer to as the Moore deed.

The mineral deed from Annie M. and Elmer Bell to the defendant R. E. Moore was recorded in the office of the register of deeds on December 30, 1969. Thereafter, on January 12, 1970, a notice of lis pendens was filed for record in the office of the register of deeds, describing the Moore deed and advising that an action was being instituted for the cancellation, rescission and voidance thereof.

This was followed by proceedings in county court declaring both Annie M. and Elmer Bell incompetent, appointing a general guardian of the persons and estates of the Bells, and the commencement of the instant action by the service and filing of an amended complaint.

Inasmuch as this matter is before us for trial de novo, we must determine the facts anew. The facts, in the main, are without contradiction. The defendant R. E. Moore has been an independent oil broker for the past twenty years with his place of business and residence at Dickinson, North Dakota. He testified that he had been watching the exploration development in this new area; that he contacted Elmer Bell on or about the 17th or 18th day of November, 1969, with the object in mind of purchasing...