Thompson v. Newman
| Decision Date | 07 May 1964 |
| Docket Number | No. 4227,4227 |
| Parties | H. M. THOMPSON et al., Appellants, v. L. B. NEWMAN et al., Appellees. |
| Court | Texas Court of Appeals |
Hugh L. Umphres, Jr., Amarillo, for appellants.
C. G. Clayton, Amarillo, for appellees.
This is an appeal from a judgment discharging the jury, and decreeing that plaintiffs take nothing.
Plaintiffs' suit was to establish a constructive and resulting trust upon the working interest of an oil and gas lease executed to defendants.
Plaintiffs Thompson, D. A. Griffith and C. A. Griffith, filed this suit against Consolidated Gas the Equipment Company, and L. B. Newman its president and alter ego. Plaintiffs alleged that defendant Newman (acting for himself and Consolidated) advised plaintiff D. A. Griffith that he was interested in acquiring leases on lands near known oil and gas production; that Griffith located unleased lands in Carson County, Texas, and advised Newman. Newman agreed with Griffith that if the leases were passed by his geologist, the working interest would be acquired by defendants, subject to a 1/16 of 7/8 override interest in Griffith. After such agreement and in reliance thereon, Griffith disclosed to Newman the location of the land; Newman wanted Griffith to go and lease the lands immediately; that when Griffith could not do so Newman suggested that plaintiff Thompson was available to secure the leases; Griffith agreed that he would pay Thompson for securing the leases (and assigned him a 1/3 interest in his 1/16 overriding royalty for same; and also assigned a 1/3 interest in the 1/16 overriding royalty to his father, plaintiff C. A. Griffith).
It was suggested that some of the leases would require payment of a bonus, and Newman said that this should be Griffith's burden; Griffith agreed, but said he had no cash and Newman agreed to advance the bonus money, and hold it out of Griffith's overriding royalty payments. Thereafter. Thompson secured the leases which were taken in Consolidated Gas Company's name. Plaintiffs allege that D. A. Griffith and defendants stood in a position of trust and confidence toward each other, by virtue of which facts when Consolidated took the legal title to the leases there arose by operation of law a resulting and constructive trust in favor of plaintiffs. Defendants drilled and took large sums of oil and gas from the lease but refuse to account to plaintiffs for their 1/16 override interest (less bonus advance indebtedness). Plaintiffs prayed for judgment that defendants be decreed to hold the lease in trust as to plaintiffs' 1/6 override and for accounting.
Defendants answered, among other things, that plaintiffs' suit was to recover a commission as real estate brokers, and that they had no real estate license; that the alleged trust, if a trust, was an express trust for an interest in real estate, and unenforceable unless in writing; and that plaintiffs' cause of action is for an interest in real estate upon a parol agreement and is in contravention of the Statute of Frauds.
Trial was to a jury. The evidence reflected (among other things) that plaintiff D. A. Griffith's father, C. A. Griffith, had dealt in the past with defendants on oil and gas leases; that plaintiff D. A. Griffith located 2 or 3 sections of unleased land near production; that the Griffiths went to see defendant Newman. Newman agreed to give D. A. Griffith 1/16 override for information as to the location of the property; that Newman wanted Griffith to go and lease the land immediately, and when Griffith could not do so, Newman suggested Thompson could do that job, but that Griffith would have to pay him for doing so out of his 1/16 override. Griffith agreed to this and assigned Thompson 1/3 of his 1/16 override. Thompson leased the lands, taking the leases in the name of Consolidated. Consolidated drilled, brought in production, but refused to account to plaintiffs, or to assign them the 1/16 overriding interest. There is evidence that the leases were to be taken by D. A. Griffith in his name and then be transferred to defendants. At the close of the evidence the Trial Court discharged the jury and rendered judgment that plaintiffs take nothing.
Plaintiffs appeal, contending that the uncontroverted evidence shows that they are entitled to judgment establishing a...
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