Taylor v. Gordon
| Decision Date | 21 December 1925 |
| Docket Number | 71 |
| Citation | 278 S.W. 26,169 Ark. 1132 |
| Parties | TAYLOR v. GORDON |
| Court | Arkansas Supreme Court |
Appeal from Ouachita Chancery Court, First Division; J. Y. Stevens Chancellor; affirmed.
Decree affirmed.
O E. Westfall and G. R. Haynie, for appellant.
Gaughan & Sifford, for appellee.
This action was instituted by the appellant against the appellee to recover the sum of $ 5,000. The appellant alleged that on or about the 29th of May, 1922, the appellee induced the appellant to permit the appellee to handle and negotiate as appellant's agent the leasing of certain lands for oil and gas; that appellee insisted that he was in a position to negotiate said lands to the advantage of appellant in that he would be able to secure a higher price than the appellant would be able to do; that appellant and his wife, induced by these representations, executed to the appellee a lease on a certain tract of land in Ouachita County; that, after procuring this lease, appellee, on the 13th of October, 1922 with the further intention to defraud the appellant, executed and delivered a written assignment of the lease of the lands to one J. E. Gaughan, as trustee, naming as a consideration therein the sum of $ 25 per acre, when in truth and fact the lease value of the lands at that time was $ 125 per acre, which the appellee well knew; that J. E. Gaughan never in fact purchased the lease, and did not pay any consideration therefor, and had no interest therein, and that such pretended assignment of the lease to him by the appellee was a fraudulent device to conceal from the appellant the true value of the lease, and to give the appellee an opportunity to sell and assign the lease for a much greater price than the pretended consideration mentioned in the assignment by the appellee to Gaughan; that the appellee falsely and fraudulently represented to the appellant that he had sold the lease described on appellant's land to J. E. Gaughan for the sum of $ 25 per acre, and that appellee settled with the appellant on that basis; that on November 28, 1922, appellee sold the oil and gas lease on appellant's land to one J. H. Snowden for $ 150 per acre, making a total sum of $ 6,000; that appellant had no means of knowing, and did not know, the appellee's fraudulent acts and conduct as above set forth in handling appellant's lands until long after appellee had finally assigned the lease to Snowden. The appellant prayed judgment against the appellee in the sum of $ 5,000, the difference between the amount for which the appellee assigned the lands to Snowden and the amount paid by appellee to appellant.
Appellee, in his answer, admitted that the appellant was the owner of the lands described in the complaint, but denied that he had induced the appellant and his wife to execute to him a written lease on the lands with the intent to cheat and defraud the appellant, and denied that he executed a lease to Gaughan as trustee with the intention to cheat and defraud the appellant. He denied that the execution of the assignment by the appellee to Gaughan as trustee, and the consideration named therein, was a fraudulent device or subterfuge employed by the appellee to deceive the appellant and conceal from him the true value of the lease. He denied specifically the allegations of fraud set up in the complaint, and alleged in substance that the appellant was a negro and unfamiliar with business practices and values of lands or oil and gas leases, and requested the appellee to assist him in disposing of the oil and gas lease on appellant's land. To this appellee consented, and, in order to enable appellee to handle the lands to better advantage, appellee requested the appellant to execute an oil and gas lease covering the lands described to the appellee, which the appellant did; that on or about the 13th of October the appellant stated to the appellee that he (appellant) could get $ 10 or $ 15 per acre for his lease and wanted appellee to sell it at that price; that appellee then told the appellant that the lease was worth more than $ 10 or $ 15 per acre, and that he (appellee) would give appellant as much as $ 25 per acre for the lease, which at that time was a fair price for the same; that the appellant accepted the offer; that other parties were interested with the appellee in the purchase, and for convenience it was agreed that title should be conveyed to Gaughan as trustee for the benefit of the appellee and the other parties associated with him in the purchase; that, since the sale of the oil and gas lease to the appellee, oil had been discovered on the land adjoining the territory in which the land of the appellant was situated, causing the price of oil and gas leases to greatly increase in value, and that it was because of this fact that the appellant became dissatisfied and instituted this action.
The appellant testified in substance that he had known the appellee for eighteen years; that he executed to him a lease on 40 acres of land on May 29, 1922. Appellant didn't know anything about oil and gas leases, and had confidence in the appellee. Appellee had promised to help appellant out in handling his oil and gas leases. Appellant therefore made the appellee his trustee and agent to sell the lease on his land. Appellant received $ 1,000 for the lease which the appellee later sold to Snowden and McSwinney. On the 13th of October, 1922, appellee sent word to appellant to come to town, and on the 14th of October appellant went to Camden and appellee gave him $ 1,000, and stated that the lease had been sold. In the conversation appellee stated to appellant that he was not charging appellant for his services, but would like to have a little piece of royalty. Appellant thought one good turn deserved another, and agreed to let the appellee have half of the royalty on 20 acres, for which the appellee paid $ 125. It was worth more than that, but appellant thought that appellee had been looking out attending to the sale of the lease for him, and on that account he let appellant have the royalty at a reduced price. Appellee did not tell the appellant at that time the name of the party to whom he had sold the lease. Appellant asked appellee who was going to pay the rental if they did not drill the land, and appellee replied, "The other fellow," but did not say who the other fellow was, and appellant did not know to whom the appellee had sold the lease until he obtained the second abstract. Just before appellee paid the appellant $ 1,000, leases were being sold on lands further from production than appellant's land for $ 30 per acre, and on land a half mile nearer at $ 40 per acre. Appellant never offered to sell the land for $ 10 or $ 15 per acre, and after he turned the lease over to the appellee, and before appellee paid him the $ 1,000, appellant had been offered from $ 22 to $ 30 per acre, and he told the persons making the offers that he would not sell it for $ 1,000 per acre unless the party would make arrangements with appellee to buy, as he (appellant) had turned the handling of his lease over to the appellee. After he turned the lease over to the appellee, he referred all persons to him, as he understood that he had made the appellee his agent to sell the lease, and he expected to pay the appellee for his trouble. Appellant testified that the appellee never told him that he would give him $ 25 an acre for the lease if appellant was willing to take it, if appellee could get others to take part of it. A man by the name of Sutton had offered appellant $ 25 an acre with a ninety-day drilling contract, and appellant told Sutton that he had placed his lease in appellee's hands, and at Sutton's request gave Sutton an order to appellee for the purchase of the lease at $ 25 an acre with a drilling contract. One or two days after appellant had signed the order for Sutton, the appellant and his wife came to town and received the payment from the appellee for the lease. Appellant at that time did not tell the appellee about Sutton's offer, as it was then too late. The appellant testified that he was not posted on the value of oil and gas leases, as he had turned the same over to the appellee. Twenty-five dollars an acre was not a fair price for the lease at the time appellant sold the same to the appellee. Some time after the appellant received the $ 1,000 from the appellee he ascertained from the new abstract that the appellee had sold the lease for $ 6,000. Appellant had no knowledge of who was buying the lease, as he was fifteen miles from Camden when the lease was sold. He did not ask the appellee the name of the man who purchased the lease. The man who came out with the paper for appellant to sign told appellant that he (appellant) was not leasing, but was just giving the appellee permission to lease same for the appellant. Appellant took his word for it, and what he signed might have been a lease. At the time the money was paid, appellant did not ask the appellee for the lease that he might sign it.
There was testimony on behalf of the appellant to the effect that about the time, on the 13th of October, 1922, some leases were selling on lands adjoining the Taylor tract at $ 30 per acre. These leases were about two miles from the Pat Marr well, which was producing oil. One of the witnesses testified that at that time he considered appellant's lease worth from thirty to thirty-five dollars per acre. This witness stated that he was willing to pay that much money on the consideration of the fact that a well was to be drilled in that vicinity; that but for that fact the lease would not have been worth that much money. They had a speculative value on account of the location of the well to be drilled in that vicinity. One of the witnesses stated that ...
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