Sun Oil Co. v. Oswell

• Decision Date: 19 January 1953
• Docket Number: 1 Div. 521
• Citation: 62 So.2d 783,258 Ala. 326
• Parties: SUN OIL CO. et al. v. OSWELL et al.
• Court: Alabama Supreme Court

Page 783

62 So.2d 783

258 Ala. 326

SUN OIL CO. et al. v. OSWELL et al.

1 Div. 521.

Supreme Court of Alabama.

Jan. 19, 1953.

J. B. Blackburn, Bay Minette, and McCorvey, Turner, Rogers, Johnstone & Adams, Mobile, for appellants.

Albert J. Tully and Holberg, Tully & Aldridge, all of Mobile, for appellees.

FOSTER, Justice.

This case comes here on appeal by the respondents from a decree overruling their separate demurrer to an original bill in equity filed by appellees.

In substance the bill alleges that on September 9, 1942, R. H. Oswell and his wife executed and delivered to the Sun Oil Company, to which we will refer as Sun, an oil, gas and mineral lease, a true copy of which is alleged to be attached to the original bill. We are particularly interested in the oil feature of the lease.

The bill alleges that by deed executed August 26, 1942, the said R. H. Oswell and his wife granted and conveyed to the complainants the land which is covered by the oil lease to Sun. We note here a discrepancy which neither the bill nor the briefs undertake to explain. That is, that the oil lease, above mentioned, is alleged to be dated September 9, 1942, whereas prior to that time, on August 26, 1942, it is alleged that the lessors deeded the land to the complainants. These complainants are two sons of said lessors. According to those allegations it would appear that R. H. Oswell did not own the land at the time he made the lease, but that it was owned by the complainants. However, complainants recognize the validity of the lease as if it was executed before they obtained title to the land. This could of course result from the fact that the deed was not delivered until after September 9th, although the bill alleges that it was executed on August 26th, and the execution of the deed implies a delivery. The deed does not appear to have been recorded until December 4, 1942, which was after the execution of the lease and, therefore, the complainants may recognize the Sun as an innocent purchaser for value.

Moreover, the bill alleges that after the execution of the lease complainants on October 30, 1950, each separately agreed to an amendment of the lease, and thereby declared it to be in full force. So we will not refer to that situation as being influential on this appeal.

The bill also alleges that on June 27, 1949, these complainants conveyed to respondent Humble Oil and Refining Company, to which we will refer as Humble, an undivided half interest in all the oil, gas and other minerals in the land described in the lease to Sun.

We will not at this time refer to the salient features of the oil lease for there is an important preliminary question which seems to be necessary for decision regardless of the terms of the lease and the conditions in regard to it. For that purpose, it is necessary for us to observe that the bill was filed against Sun and Humble by these complainants who, as we have said, are the grantees of the land, but subject to Sun's lease, and it alleges that Sun had violated the implied and expressed covenants in the lease to such extent that complainants were entitled to a cancellation of the lease to Sun, and it prayed the court to adjudge and decree, (a) that Sun had abandoned and forfeited all its right, title and interest in and to the land described in said lease, see, Shannon v. Long, 180 Ala. 128, 60 So. 273; (b) that the lease be declared void and of no effect; (c) that Sun and its successors in interest under said lease be enjoined and restrained from asserting any right by virtue of the same, and (d) for general relief. There is no prayer in respect to Humble.

There was an amendment to the bill, as to which it is not necessary to refer immediately. Demurrer was separately filed by Sun and Humble. The cause was submitted on demurrers and the decree merely overruled the same. The appeal was taken by Sun and Humble jointly. There was a severance in the assignment of errors wherein Sun assigned as error the overruling of this demurrer to the bill, and Humble did likewise.

The first question to which we wish to call attention is that, so far as the oil and other minerals are concerned, the complainants and Humble are tenants in common subject to the lease of Sun, whereby the complainants own an undivided half interest in the oil and other minerals as well as all the surface rights, and Humble owns an undivided half interest in the oil and other minerals.

So we have a status whereby tenants in common, owning an undivided half interest in the subject of the lease, seek to have this Court declare the lease abandoned and forfeited in its entirety and declared to be void and of no effect, and that notwithstanding the fact that Humble owning the other half interest in the oil is opposing that result. The complainants do not specifically seek to have the oil lease to Sun abandoned and forfeited in so far as it affects only their undivided half interest in it.

We have had occasion to refer to the rights and interests of tenants in common in respect to a cancellation of a lease, which they had entered into, on account of fraud in procuring its execution. It was shown that a tenant in common, in respect to such a claim, occupies a status which gives him that personal right so far as his interest is concerned without reference to whether the others participate in the suit or not. We refer to the case of Glass v. Cook, 257 Ala. 141, 57 So.2d 505, where we supported that principle. We there justified such equitable relief in favor of some tenants in common to cancel a lease executed by all of them, each for his own interest, for the use of store property, where the contract of lease was obtained by fraud as to the complaining cotenants. In that case one of the cotenants who joined in the lease was alleged to be a party to the fraud and he was made a party respondent, but his interest was not subject to be cancelled. The fraud in procuring the execution of the lease was as to each a personal and severable transaction, and each could, acting for himself, elect either to cancel as to his interest or ratify and confirm it regardless of what the others might elect to do. We also referred to this principle in Cooper v. Peak, Ala.Sup., 61 So.2d 62(11), where there was no indivisible covenant involved.

With reference to the right of cotenants to act severally on account of the breach of covenants by the lessee, it is said in the case of Howard v. Manning, 79 Okl. 165, 192 P. 358, 361, 12 A.L.R. 819, that a 'lessor could not fractionize or apportion the lessee's covenant by either conveying the lands to several parties as tenants in common or dying and leaving it to a number of heirs. The death of the lessor did not apportion or divide the covenant. The lessee's contract was not altered, modified, or affected by the death of the lessor other than with respect to the payment of the rent. After passing out of the hands of the lessor's administrator (if he had one) each heir had the right to receive his part of the rent, but that did not apportion the indivisible covenants in the lease. Upon the death of the lessor the lessee's covenants in question run to the heirs jointly and indivisibly.' On the other hand, it is there also said: 'In theory a lease of land by two or more tenants in common is not regarded as one lease by all of them of the premises in its entirety, but as several leases by the tenants in common of their undivided separate and respective shares.' But it is pointed out that there is a distinction when the lease is by joint tenants, saying: 'If all the joint tenants unite in the execution of a lease, it is regarded in law as but one lease made by one lessor, whereas a lease executed by several tenants in common is regarded as several leases of their respective and separate shares.' In Alabama of course we have no principle of 'joint' ownership as distinguished from tenants in common. Title 47, section 19, Code; Hill v. Jones, 65 Ala. 214, 220. But as respects the divisibility of the lessee's covenants it is said: 'Under the American authorities the lessee's covenants, unless expressed otherwise, are joint and indivisible under a lease executed jointly by all the tenants in common', also that 'one of them, or two representing one interest, could not maintain an action for a breach of it by the lessee', citing Calvert v. Bradley, 16 How. 580, 581, 14 L.Ed. 1066. The clause last above quoted is the subject of much discussion and seems not to apply to the claim of rent. See 12 A.L.R. pp. 828, 830; 34 A.L.R. p. 795.

In the case of Utilities Production Corp. v. Riddle, 161 Okl. 99, 16 P.2d 1092, we find there was a lease executed by Mr. and Mrs. Riddle who were the owners of an eighty acre tract of land. Thereafter they made conveyances of certain interests in the land. The court held, in a suit to cancel the lease for the breach of an implied covenant to develop the operations, that Mr. and Mrs. Riddle being then tenants in common of the oil and mineral interests with others, to whom they had conveyed an interest subject to the lease, could not maintain such a bill without the participation of the other tenants in common with them, and that it could not be done until after all of those tenants in common had joined in a notice to the lessee of an intention to declare a forfeiture of the lease, and demand that the lessee comply with the implied covenant. This conclusion was reached upon the basis of another case in Oklahoma of Hawkins v. Klein, 124 Okl. 161, 162, 255 P. 570. In that case the owner of the land executed an oil and mineral lease, similar to the one we are considering, and then died leaving several heirs. It was held that all the heirs must concur and unite in the election to enforce a forfeiture on account of the breach of the entire and indivisible covenants and that no one of the heirs, by virtue of his cotenancy, is authorized to act for his cotenants in enforcing a forfeiture. ...