Whatley v. Wood, 20588
| Decision Date | 19 July 1965 |
| Docket Number | No. 20588,20588 |
| Citation | 157 Colo. 552,404 P.2d 537 |
| Parties | William J. WHATLEY, Plaintiff in Error, v. Dorothy Stevens WOOD, Truman Stevens Wood, Ben Brown Wood, Marie G. Murphy, and Wallace E. McGowan as Executor of the Estate of Irene McGowan, Deceased, Defendants in Error. |
| Court | Colorado Supreme Court |
Mincer & Larson, Glenwood Springs, for plaintiff in error.
Lewis, Grant & Davis, Donald S. Stubbs, William P. Waggener, Zarlengo, Zarlengo & Seavy, Teller Ammons, V. G. Seavy, Jr., Denver, for defendants in error.
We will refer to plaintiff in error, William J. Whatley, as plaintiff and to defendants in error, Dorothy Stevens Wood, et al., as defendants.
This action was originally commenced April 4, 1958 as a suit to quiet title to certain real property located in Garfield County, Colorado, amounting in the aggregate to 1899.60 acres of land. In a prior writ of error to this court Whatley v. Wood (No. 19609), 148 Colo. 349, 366 P.2d 570 (1961) the instruments and, in fact, the entire transaction under which the defendants claimed title as individuals to the property in question were set aside and the case was remanded to the trial court for further proceedings--the sole question remaining at that time was to determine the validity of the deed under which the plaintiff claimed his title.
In the first trial of this case one of the defendants, John V. Cuddy, obtained a summary judgment in so far as his leasehold interest in the real property involved was concerned and as a result thereof his case was heard in this Court under a separate and distinct writ of error, viz., Whatley v. Cuddy (No. 19551), 148 Colo. 362, 366 P.2d 671 (1961). The Cuddy writ of error also resulted in a reversal. The case was re-tried in the District Court of Garfield County in August 1962. In the retrial, the matter was again heard as a single case but in two separate stages or parts: first, concerning the validity of the Cuddy lease, and second, concerning the validity of the deed under which the plaintiff claimed his title. By ruling of the trial court during the re-trial of the case, the entire record and all exhibits in the former proceedings were automatically made a part of the record, evidence and proceedings in the re-trial. Separate judgments were again entered: one against plaintiff, William J. Whatley, in which his deed was held to be void, and the other against the defendant John V. Cuddy, in which his lease was held to be void. The Cuddy portion of the case is again the subject of a separate writ of error (No. 20544) 404 P.2d 533. The opinion, however, is concerned only with the judgment which decreed that the plaintiff's deed was void and that, therefore, the plaintiff has no right, title or interest in the real property in question.
Plaintiff alleges eight grounds of error for reversal only four of which we consider to be pertinent to the decision of the case. We summarize these grounds as questions in the following form:
(1) Did the defendants have sufficient interest in the subject matter to attack Whatley's title when they were named as defendants in the quiet title action?
(2) In order to invalidate the deed to the plaintiff, is it necessary that the evidence of value and breach of trust be clear, convincing and almost a certainty, or beyond a reasonable doubt; and, does evidence of such character exist in this case?
(3) Was the evidence as to value which the trial court received and relied upon improper evidence for the purpose of this case? And (4) Were the trial court's findings, upon which the judgment declaring plaintiff's deed invalid is based, supported by the evidence?
The facts necessary for understanding the issues are as follows: Plaintiff's father was the owner of ranch property that adjoined the land in question. The father, over a period of time, had acquired title to various unpatented mining claims in the area and subsequently applied for a patent on those claims. During that time, the father had contacted one Murphy whom he thought to be the owner of another group of unpatented mining claims adjoining the claims upon which he had applied for a patent. The reason for this contact with Murphy was to determine whether it would be possible to combine the claims so that a sufficiently large acreage could be assembled for the purpose of interesting possible future purchasers of oil shale lands.
Murphy died in 1953 before any further action was taken. During the succeeding two years several conferences were held between the father and Mrs. Murphy's lawyer but these were without fruition.
Sometime prior to 1958 it appears that the father and examined the original records in the general land office and discovered that an application to patent the claims in which he was interested had been rejected. After determining that there had been a final rejection of the patent application and that the time for appeal had expired, he then proceeded to examine the records to determine the title status of other unpatented mining claims in which he was interested. At this time he learned of the possible title of the Colorado Carbon Company, a defunct corporation, in some unpatented claims and in the patented claims in question.
Prior to 1958, the father had also discovered that Richard E. Larch was the sole surviving director and trustee of the Colorado Carbon Company. Knowing that a conveyance from Leach was necessary to clear title to the properities held by the company, he proceeded to try to contract him. A search revealed that the elderly Leach was residing in California confined to a nursing home. Wishing to have it explained to Leach as to why a quit claim deed to his son for the patented claims was desired from him as the company's sole surviving trustee, and, in order to take care of the father's desire for a separate deed and stock assignment relating to the unpatented claims not involved here, the father employed an attorney who was an old friend of Leach's. The attorney then went to California to ascertain if he could secure Leach's signature to a deed to the son, as well as an executed deed to the father to the unpatented claims, and also a stock assignment. The contact was then made in California. On March 7, 1958, Leach executed the quit claim deed involved here upon payment to him of a consideration of $150.00.
At the time the deed was executed, plaintiff knew that the property in question had a high potential value not only for oil shale purposes, but also for possible oil and gas rights as well as for the grazing rights. He knew that Leach was an elderly man who had been out of contract with the property since 1931 and, therefore, did not know the true value of the property, nor the situation as it existed in 1958.
It was with this knowledge that plaintiff sent his agent to California to secure a deed to valuable property for the price of $150.00--which property an expert witness testified at the trial in 1958 to be worth somewhere between $30,000.00 and $75,000.00 providing it had a marketable title and depending upon certain other factors.
We turn now to the four issues to be determined on this writ of error.
Plaintiff's first contention is that defendants did not have sufficient interest in the subject matter to attack Whatley's title when they were named as defendants in the quiet title action. The record discloses that defendants who appear here, also were defendants in the first writ of error in this case. In that action they were contesting plaintiff's claim of title because they claimed to have a superior title based on one which was allegedly derived from a series of conveyances originating from two of the three directors of the company who were holding such position at the time the company became defunct in 1935. On the first writ of error we held that the defendants' claim of title based on the conveyance from only two out of three directors was invalid.
At the second trial defendants contend that they appear not as owners claiming under a deed, but as creditors and stockholders of the defunct Colorado Carbon Company.
On the first writ of error, title to the land in question was held to be in the creditors and stockholders of the defunct corporation, subject to the validity of the deed given by Leach and held by plaintiff Thus, the present defendants, if they are stockholders or creditors or both, are proper parties to challenge the validity of plaintiff's title. Though their claimed status in this regard is...
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