Skelly Oil Co. v. Globe Oil Co.

CourtSupreme Court of Oklahoma
Citation200 P. 537,1921 OK 221,82 Okla. 214
Docket NumberCase Number: 11648
PartiesSKELLY OIL CO. v. GLOBE OIL CO. et al.
Decision Date07 June 1921
Syllabus

¶0 1. Mortgages--Foreclosure -- Right to Receiver. When mortgagee asks for foreclosure of his mortgage and asks for the appointment of a receiver upon grounds set out in section 4979 of the Revised Laws of Oklahoma, 1910, and such grounds being established by the proofs, the mortgagee is entitled to have a receiver appointed, as a matter of legal right, and under such circumstances the denial to the mortgagee of a receivership would be a substantial violation of a statutory right possessed by the mortgagee.

2. Appeal and Error--Discretion of Court--Appointment of Receivers. The appointment of receivers by the inferior courts, when brought to the Supreme Court for review, will not be reversed unless it clearly appears that the lower court abused the discretion, placed with such inferior courts, under the provisions of section 4979. Rev. Laws 1910, chapter on Receivers. (Willard Oil Company v. Riley et al., 29 Okla. 19, 115 P. 1103.)

3. Appeal and Error--Review of Evidence--Requisites of Brief. Causes appealed to the Supreme Court of this state, wherein it is asked that the action of the trial court be reversed for insufficiency of the evidence, and to review alleged error by the trial court for wrongful findings from the evidence, it is necessary for the appellant to comply with the requirements of rule No. 26 (47 Okla. x) of the appellate court in preparation of brief, otherwise the assignment, not so supported, may, in the discretion of the court, be ignored.

C. C. Herndon, W. P. Z. German, and Linn & Riddle, for plaintiff in error.

Hulette F. Aby and William F. Tucker, for defendants in error.

ELTING, J.

¶1 This action was brought in the district court in and for Tulsa county, state of Oklahoma, by the Skelly Oil Company, a corporation, plaintiff, against the Globe Oil Company, a corporation, Nelson L. Barnes, T. R. Karnes, Calvin O. Smith, R. R. Smith, G. G. Gillette, John O. Mitchell, Ft. Dearborn Trust & Savings Bank, a corporation, and Frank M. Forrey, defendants. The action is in the nature of an action for specific performance against the Globe Oil Company and other parties, who are officers of the Globe Oil Company, and the Ft. Dearborn Trust & Savings Bank, and Frank M. Forrey, as trustees, under a trust deed. The petition of the Skelly Oil Company states, in substance, that on the 17th day of February, 1920, the plaintiff and the defendant, the Globe Oil Company, entered into a contract whereby the Globe Oil Company sold to the plaintiff, the Skelly Oil Company, all of the oil and gas leases described in schedule "B", attached to the petition, and located in the state of Oklahoma. That the plaintiff was to pay the defendant, the Globe Oil Company, $ 900,000 for said property, and that at the time said contract was entered into the Skelly Oil Company, plaintiff, paid to the Globe Oil Company, defendant, $ 250,000; $ 200,000 of which money was forwarded by the Globe Oil Company to the Ft. Dearborn Trust & Savings Bank, and was applied on the indebtedness due on the deed of trust held against the Globe Oil Company by the said Trust & Savings Bank, as trustee; and that the balance of said purchase money was to be paid to the Globe Oil Company upon the approval of the title by the attorneys of the plaintiff, the Skelly Oil Company. The plaintiff below alleged certain other grounds amounting, as it charges, to fraud on the part of the Ft. Dearborn Trust & Savings Bank and Frank M. Forrey in which it asks for what might be called a marshalling of assets of the Globe Oil Company, based upon certain averments of the petition. Plaintiff further states that the said Ft. Dearborn Trust & Savings Bank and Frank M. Forrey had notice and information in their possession sufficient to put them upon inquiry as to the rights of the plaintiff, the Skelly Oil Company, and that the same was acquired by the said bank and said trustee, Frank M. Forrey, shortly subsequent to the contract of purchase, and that the application of said money to the debt of the Globe Oil Company amounted to a ratification of contract. The prayer of the petition of the plaintiff below was in words and figures as follows:

"Wherefore, plaintiff prays that the defendants, and each of them, be cited to appear and answer herein and upon final hearing, plaintiff have a decree of this court for specific performance as against the defendant, Globe Oil Company, and that the defendant trustees, as herein referred to, be required to apply to said valid indebtedness held by them all of the proceeds placed under their trust deed and the equity in all other properties held under said trust deed, and apply the proceeds thereof to the satisfaction of any valid indebtedness which may be due or existing under said deed of trust. Plaintiff further prays that the $ 600,000.00 of indebtedness evidenced by notes, if in existence, may be cancelled and held for naught, or in any event, held to be inferior and subordinate to the rights of plaintiff herein; that the defendant, First National Bank of Tulsa, be required, by decree of this court, to deliver all of said executed assignments to the plaintiff, and that the Globe Oil Company be required to execute and deliver assignments of said other leases to plaintiff, and that plaintiff's title be quieted. Plaintiff further prays that if for any reason the court should find it impossible to require a specific performance that then plaintiff have a judgment for its damages in the sum of five hundred thousand dollars ($ 500,000.00) and the interest thereon; and plaintiff further prays for such other relief, general and special to which it may be, in law or equity, entitled, and for all costs of suit."

¶2 It is alleged that the contract of sale between the plaintiff below and the defendant below, the Globe Oil Company, was in writing, and a copy is attached to the petition. To the petition of the plaintiff below, the Ft. Dearborn Trust & Savings Bank and Frank M. Forrey filed a separate answer and cross-petition. In which pleading the Ft. Dearborn Trust & Savings Bank and Frank M. Forrey denied the allegations as to notice of contract prior to the application of the $ 200,000 on the indebtedness of the Globe Oil Company, set up their deed of trust against the Globe Oil Company, set out the amount of indebtedness due from the Globe Oil Company, which they alleged to amount to $ 1,445,000--$ 100,000 for attorney fees and other charges; and alleged that the property of the Globe Oil Company embraced in the deed of trust, which embraced the property claimed by the Skelly Oil Company, plaintiff below, was not sufficient to pay the debt due under the deed of trust; alleging, further, that the Skelly Oil Company was a purchaser with notice of said deed of trust, and not being in any way liable for said debt due by the Globe Oil Company under the deed of trust, and that the Skelly Oil Company was a purchaser under its contract of certain properties embraced in the deed of trust; that the Skelly Oil Company having bought with notice, its rights to said property were inferior to the rights of the holder of the trust deed. They set up, further, the fact that the Skelly Oil Company, plaintiff below, had gone into possession of the property it had purchased under said contract from the Globe Oil Company, and that the Skelly Oil Company was converting to its use the profits and proceeds of said property and had failed and refused to account to the holders of the trust deed, after demand by the answering defendants and cross-petitioners, for the profits and proceeds of said property. Alleging, further, that, under terms of the trust deed, the trustees were entitled to proceeds ensuing from the property. That the oil companies were failing and refusing to have said property insured, were permitting the leases thereon to default and were committing acts of waste, and were failing to do the other things alleged in the cross-petition, necessary to protect the property covered by the trust deed; and prayed for foreclosure of the mortgage or trust deed and for the appointment of a receiver. The prayer of the separate answer and cross-petition is in words and figures as follows:

"Wherefore, defendants pray that they have judgment against the defendant, Globe Oil Company, for the principal sum of said notes outstanding and unpaid, to wit, the sum of one million four hundred forty-five thousand dollars ($ 1,445,000.00) with the interest accrued thereon, from the 15th day of February, 1919, until paid together with the sum of one thousand dollars ($ 1,000.00) in expenses laid out by the trustees, and the further sum of one hundred thousand dollars ($ 100,000.00) as attorney's fees for trustees, and for its costs and for further judgment foreclosing the lien of the said deed of trust upon the said property, and forever barring the defendant, Globe Oil Company, and the plaintiff, Skelly Oil Company, from any lien, estate, interest or title thereto, and that the premises he ordered sold as a whole or in separate parcels, to satisfy the said judgment. That forthwith and pending the final judgment herein, a receiver be appointed to take possession and charge of the said property, situated in the state of Oklahoma, collect therefrom, and to operate said oil properties under the orders of this court."

¶3 To the said separate answer and cross-petition, the plaintiff below, plaintiff in error herein, filed a motion to dismiss the cross-petition. Same was overruled, whereupon plaintiff filed a demurrer to the cross-petition, and the same was by the court overruled and upon the question of appointing a receiver under said cross-petition evidence was introduced, and after the matter had been heard and argued the Hon. Owen Owen, District Judge, did on the 5th day of August, 1920, make an order appointing Tracy D....

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