Starr v. Ripley

• Decision Date: 06 January 1954
• Docket Number: No. 10179,10179
• Citation: 265 S.W.2d 225
• Parties: STARR v. RIPLEY et ux.
• Court: Texas Court of Appeals

Page 225

265 S.W.2d 225

STARR v. RIPLEY et ux.

No. 10179.

Court of Civil Appeals of Texas, Austin.

Jan. 6, 1954.

Rehearing Denied Feb. 10, 1954.

Kelley, Looney, McClean & Littleton, Willard E. Dollahon, Edinburg, for appellant.

Carter, Stiernberg, Blanton & Skaggs, Harlingen, Stricklan, Wilkins, Hall & Mills, Mission, Leon Green and M. K. Woodward, Austin, for appellees.

HUGHES, Justice.

This appeal is from a summary judgment rendered against appellant H. L. Starr who had sued appellees C. A. Ripley and wife, Kathryn Taylor Ripley, to establish his ownership of an undivided one half interest in approximately 610 acres of land in Hidalgo County and for incidental relief.

We will hereafter refer to appellant as Starr and appellees as Ripley as Mrs. Ripley is not alleged nor shown to be an active party.

We will determine the validity of the summary judgment by a consideration of the allegations of Starr's pleadings and his depositions which were then on file accepting as true his testimony and the factual allegations of his pleading.

Starr alleged that in 1944 he was engaged in the business of mortgage loans, investments and real estate in Hidalgo County; that in February of that year he learned that the lands in suit might possibly be purchased at a bargain price of $25 per acre; that since he had formerly been associated with the Reserve Loan Life Insurance Company in its business of placing mortgage loans in Hidalgo County he was familiar with its methods and procedures and was personally acquainted with company personnel who passed on loan applications.

Starr, thereupon, conceived the idea that he would be able to use his knowledge of and influence with such loan and insurance company in obtaining a loan on the subject lands of at least $100,000, or about 2/3rds of the contemplated purchase price, which loan, if obtained, plus a bonus from leasing such land for oil and gas, which lease he felt certain he could sell through other connections which he had, would be sufficient to raise the bulk of the purchase price, leaving only a small difference in cash to be supplied by someone whom he might interest in a joint purchase of the land.

Starr had previously known Ripley, had worked with him on various financial matters and was familiar with his business operations. Starr went to Ripley and told him about the land, its availability, and his plan for its joint purchase and Starr about February, 1944, orally proposed to Ripley:

That the two men would buy the land jointly but that both the contract to purchase the land and the deed conveying the title, when it might be prepared, would be taken in Ripley's name alone, but that, nevertheless, Starr and Ripley would be acquiring the land jointly; that Starr would procure from the loan insurance company a maximum loan on the land, would try to lease the land for oil and gas development, applying all sums received therefore on the purchase price and that Ripley would pay or advance the cash difference required to complete the purchase; that the land was to be acquired jointly from the beginning with respective equal interests vesting in each of them from the date of the deed but that the revenues realized from leasing, renting, farmining or other operations of the land would be applied on loan payments and to reimburse Ripley, the net profits or proceeds to be equally divided between Starr and Ripley.

Ripley accepted Starr's proposal without qualifications.

During the months of February and March, 1944, Starr negotiated with prospective oil and gas lessees of the land and succeeded in obtaining their oral promises to lease the land when the owner of the land, Raymond E. Buck, executed a contract to sell; during this time Starr also worked at the other matters relating to the sale, he and Ripley going together to see Mr. Harry Ridgeway who represented the owner of the land after which Starr and Ripley went together to inspect the land and thereafter both together advised Ridgeway they wanted a contract of sale drawn. A contract of sale was drawn with Buck as seller and Ripley as purchaser and Ripley at that time paid $3,000 on the purchase price and for his services in helping effect the transaction Ripley and Starr paid Ridgeway $500, each paying $250.

After the execution of the contract and pursuant to the joint enterprise and as a result of Starr's efforts, oil and gas leases were made covering some of the Buck lands and received therefor was the sum of $1,626.62. The general warranty deed to the lands was delivered to Ripley in December, 1944, and during the interim between the contract and the deed Starr, exclusively through his own efforts, procured a $10,000 loan on the property from Reserve Loan Life Insurance Company. The closing transactions required the payment by Ripley of an additional $738.63.

Ripley took possession of the lands for himself and Starr under and pursuant to their verbal agreement and he, Ripley, has continued to occupy and make use of the premises.

From time to time, following the purchase of the lands, Starr inquired of Ripley concerning the property, farming operations thereon and the status of their accounts and would request statements, etc., but that Ripley for various reasons did not furnish such statement or accounting. These demands by Starr upon Ripley did result in the following letter from Ripley to Starr of date April 2, 1946:

'Mr. H. L. Starr

McAllen, Texas

'Dear Mr. Starr:

'You may use this letter as confirmation and acknowledgment of the fact that you and I are partners in the ownership of a certain tract of land known as Adams Tract, being South of Donna, Texas, on the Military Highway, consisting of approximately Six Hundred (600) acres, more or less.

'Very truly yours,

/s/ C. A. Ripley.'

Starr relied upon this letter and oral assurances from Ripley regarding the property and his interest therein until about June, 1949, when he learned that in 1947 Ripley had included this property along with other property in obtaining a loan for $35,000. The result of hearing about this loan and Ripley's continued refusal to account was the institution of this suit on June 16, 1950.

Starr's prayer was that he be decreed the owner of an undivided one half interest in the involved lands and that the record title thereto in Ripley be impressed with a trust to the extent of such interest and he prayed, as well, for an accounting and other incidental relief.

We now set forth some of the pertinent and unexplained deposition testimony of Starr which the lower court had before it and considered in rendering summary judgment against him:

'A. My agreement was that we would buy this land as a joint venture and that we could secure a loan of $10,000 on that property.

'Q. * * * Now, I will ask you, did you agree on or about August 1st, 1948 to lease said lands for oil and gas? A. We had agreed on that long before that.

'Q. Then I would say that I then called Rip (Ripley) and told him that I knew of this tract of land that we could buy for $25.00 straight across per acre. I told him that I thought it was a very good buy. I said, 'We can buy it and it will cost us about $15,000, and we can get a loan of ten thousand on it, I am sure, and we can lease it for from two to five dollars an acre and we will have to put up very little money.' Then Rip said, 'OK, if you think it's a good deal I will send you a check for $5,000.00.' * * *

'A. When Rip wanted to send me a check for $5,000.00 I said, 'No, we don't need any money now', I said, 'Just wait and I will let you know when'. Then I made an appointment with him to meet him up at the Donna Irrigation District, and we met there. * * *

'Q. Tell that conversation now, that was held in the Irrigation District Office. A. I told Harry (Ridgeway) that we were interested in buying that, and he got the plat out and showed us the acreage on the plat. He told us that he thought sure that he could secure that land for us from Buck for $25 an acre. So we then got in the car with this canal rider and went down and looked over all the properties. We came back into the office, told Harry that we would take it, and on what basis, and that Rip and myself were going into it on a fifty-fifty deal, that it was a joint venture. And we told him that if he would help us get this land we would give him $500.00. And the deal was that whatever money that Rip had to put up, that the revenues from the property would go to retiring the money he had put in, and after enough revenues from that property was received, then-and Rip had cleared his original investment, then the revenues from there on would be split fifty-fifty between he and myself after the principal payments and taxes and interest had been paid.

'Q. Was it agreed that you were never to put any money on that deal, Harry? A. Yes sir, that's right.

'Q. And if your deal didn't pay out, any loss on it would be borne by Ripley? A. Well I don't remember whether that was discussed or not.

'Q. In other words, the cost of making improvements on the property, none of that was to be borne by you? A. That wasn't discussed at all.

'Q. And of course you did discuss the fact that those $10,000.00 in notes would have to be paid. A. Certainly.

'Q. Was it agreed that you would not have to pay anything on those notes? A. Not until Rip had got his money out of his original investment, then the revenues from the property would then go to retiring the interest and principal and taxes, and then what revenues was left would be split with us fifty-fifty. * * *

'A. I don't know just when Rip entered into the contract. He put up an escrow check of $3,000.00 when he and Buck entered into the contract, and that was sometime in April.

'A. There was never any payments to be made by me. The revenues from the land was to take care of that.

'Q. And of course if there were any losses, it was discussed that he could stand them all? A. We didn't discuss about any losses. We figured...