Summary
holding that court had no power to change contract actually made and truly embodied in written instrument on basis of reformation when evidence showed that parties made no mistake in preparing or drafting deed
Summary of this case from Hills v. Sonterra EnergyOpinion
No. 4416.
January 18, 1934. Rehearing Denied January 25, 1934.
Appeal from District Court, Gregg County; C. G. Dibrell, Judge.
Suit by W. H. Kennedy against C. C. Clemmens and wife and others, wherein other parties were impleaded. From a judgment in favor of plaintiff and other defendants, named defendant and wife appeal.
Affirmed.
The appellee W. H. Kennedy brought the suit claiming that he owned an undivided one-eighth of the oil, gas, and other minerals in and under a certain described 60 acres of land. The appellants were named as defendants upon the averment that they were asserting some adverse interest or claim to the mineral rights and in the land, and asking to have the title adjudicated as between them. Certain named pipe line companies were named as parties defendants, and personal judgment was sought against them, as purchasers owing and refusing to pay for oil that was produced from the land.
Appellants made answer and sought to have reformation of the conveyance made by them in the respect pleaded, namely:
"These defendants further show to the court that it was the intention of both the Grantors and the Grantees in said instrument dated October 23, 1930, and described in paragraph two of plaintiff's petition to convey to said Grantees an undivided one-half of Grantors' undivided one-half interest, which is equivalent to one-fourth of the said 60 acre tract and it was not the intention of the parties to convey a greater interest in the minerals than the said one-half interest, and said fact was mutually understood by and between both grantors and grantees in said mineral conveyance.
"These defendants further show to the court that if said instrument dated October 23, 1930, purports to convey more than one-half of grantors' one-half interest in said minerals, then and in that event said instrument does not and did not speak the true intent of the parties, and if said instrument purports to convey a one-half of the minerals under the entire 60 acre tract, the said one half was inadvertently and accidentally or by mistake placed in said instrument so as to apparently convey the one-half interest to the entire 60 acre tract when said instrument should have conveyed one-half of grantors' one-half of the minerals in and under said 60 acre tract."
A number of other parties were impleaded, and their respective answers and pleadings are shown in the record. Several of the parties interpleaded holding or claiming mineral interests under the deed in controversy set up the plea of bona fide purchasers.
After hearing the evidence, the court peremptorily instructed the jury to return a verdict in favor of the plaintiff and against the defendants C. C. Clemmens and wife, and also in favor of the other named defendants as shown by the charge. Judgment was entered in keeping with the verdict. The defendants C. C. Clemmens and wife have appealed from the judgment.
The evidence shows, as far as pertinent to state:
That C. C. Clemmens and wife, Hannah Clemmens, on April 24, 1930, executed to B. A. Skipper a lease for the exploration and production of oil upon the land described, namely: "The following described real esstate situated in Gregg County, State of Texas, to-wit: 60 acres of land in Gregg County, Texas, patent No. 291, Abstract No. 186, original grantee, D. Sanches, M. Cartwright, Patentee, described as follows, (here follows courses and distances and bounds) containing 60 acres of land, more or less, it being the intention to include all land owned or claimed by Lessor in said survey or surveys."
The lease contained the following provision: "Without impairment of Lessee's rights under the warranty in event of failure of title it is agreed that if the Lessor owns an interest in said land less than the entire fee simple title then the royalties and rentals to be paid Lessor shall be reduced proportionately."
This lease was registered September 12, 1930. On October 23, 1930, C. C. Clemmens and wife executed a conveyance to W. H. Kennedy, L. T. Zeigler, and two others, jointly, in consideration of $180 cash, granting and conveying to the grantees, namely: "An undivided one half (1/2) interest in and to all of the oil, gas and other minerals in and under, and that may be produced from the following described land situated in Gregg County, Texas, to-wit: (here follows description of the land precisely as set forth in the above lease to B. A. Skipper)."
The following provision appears therein: "Said land being now under an oil and gas lease executed in favor of B. A. Skipper, it is understood and agreed that this sale is made subject to the terms of said lease, but covers and includes one-half (1/2) of all the oil royalty, and gas rental or royalty due to be paid under the terms of said lease."
Some mineral interests under this conveyance were made by the grantees to the other defendants in this case. W. H. Kennedy acquired the interests of L. T. Zeigler and others.
It was proven that C. C. Clemmens acquired the 60 acres of land in 1911, and at the time he was married, and was living with his wife, Mrs. Mary Clemmens; that Mrs. Mary Clemmens died intestate in 1915, leaving six children, all of whom are still living. That there was "no administration ever had on her estate"; that at the time of making the lease and mineral conveyance above mentioned, C. C. Clemmens owned an undivided one-half interest in the 60 acres, and that the six children owned by the law of descent and distribution the other undivided one-half interest of Mrs. Mary Clemmens; that C. C. Clemmens married Mrs. Hannah Clemmens his present wife, in 1924.
On March 21, 1918, as proven, "C. C. Clemmens for himself and as survivor of the community estate of himself and deceased wife, Mary Clemmens," executed a deed of trust to M. H. Gossett, trustee, on the 60 acres of land involved in this controversy. This deed of trust was duly registered March 27, 1918.
As bearing upon the mutual mistake pleaded, C. C. Clemmens testified: "I made a mineral conveyance in October, 1930, to Mr. Zeigler. I dealt with Mr. Zeigler, and no one else. He had a note against a car I had for $180.00, and he said he would give me my note for a half interest in my royalty on this 60 acres. I said I would do it. I then said to him in the deal, I wanted him to waive this rental portion of the lease as it didn't sound right. An attorney wrote it up for him and instead of mentioning half of my part it mentioned thirty acres. In this last deal that is in question there wasn't anything said; I just came by and told him I would make the deal and he sent a notary public out there with this lease and I signed it. The deal I said I would make with him, that I would sell a half of my royalty for $180.00, under my 60 acres of land. I believe that was the amount of money he held against my car. I don't remember what was said in particular. He just offered me $180.00 for a half interest in my royalty and I taken him up after a few days. He had an attorney to prepare the instrument. I thought I owned 60 acres, and I intended to convey half of that 60 acres which would be 30 acres. * * * I talked to Mr. Zeigler, and at that time I thought I owned the 60 acres of mineral rights. I gave him a deed to one half and I thought at the time I was giving him a deed to one half of all the mineral rights."
Mr. Zeigler testified: "We were buying half of the minerals under the 60 acres. We both understood that Clemmens owned the 60 acres. We were buying half of the minerals under the 60 acres. We were buying half of the minerals under the 60 acres under the assumption that Clemmens owned all of the land. We were buying 30 acres of the minerals, and we were buying it on a six-dollar base, and paid him $180.00."
Mr. Zeigler was representing the other grantees in the mineral deed. L. N. Skipper, who was one of the grantees, testified: "In my understanding we were buying half of the royalty under the 60-acre tract. I would not have bought and paid my part of the $180.00 if I had known that Mr. Clemmens was contending or would contend that it was not half, but one-half of one-half."
Mr. Kennedy, a grantee, testified: "I the $180.00 if I had known that Mr. Clemhalf of the royalty under this 60 acres. Mr. Clemmens never came and told me he didn't mean to sell but one-half of his one-half. I would not have purchased at the price paid if I had known that Mr. Clemmens was claiming or would ever claim that he was only selling one-half of his one-half."
There is no contention of fraud on the part of any one.
Geo. Prendergast, of Marshall, and Edwin Lacy, of Longview, for appellants.
Hatchell Campbell, Saye, Smead Saye, C. E. McGaw, and Carrigan, King Richardson, all of Longview, for appellees.
It is insisted on appeal that there was error in giving a peremptory instruction. In support of the proposition it is urged, first, that, in view of the respective provisions mentioned in the lease to B. A. Skipper and in the mineral conveyance to W. H. Kennedy and others, the mineral conveyance to W. H. Kennedy and others should be construed as conveying to W. H. Kennedy and others one-half only of the royalties in the legal ownership of C. C. Clemmens, which, under the undisputed evidence, would be one-half of C. C. Clemmens' one-half or one-fourth of the royalty of the entire 60 acres. The case of Hoffman v. Magnolia Petroleum Co. (Tex.Com.App.) 273 S.W. 828, 829, is relied upon as being decisive of the point stated. We conclude that the trial court has correctly construed the mineral deed. The conveyance expressly passed an estate of an undivided one-half of the oil under a particularly described tract, and then provided that the grant was subject to an oil and gas lease, "but covers and includes one half (1/2) of all the oil royalty, and gas rental or royalty, due to be paid under the terms of said lease." The grant is clear and unequivocal of "an undivided one-half interest" in the royalty in the whole 60 acres. And even though it be assumed that the grant is not clear, the deed nevertheless should be construed, as in the Hoffman Case, supra, "against the grantor, rather than against the grantee," as passing the greatest estate possible. The grant was made "subject to the terms" of an oil and gas lease to B. A. Skipper, "but covers and includes one-half of all the oil royalty" under the "terms of said lease." This refers to the interest of C. C. Clemmens in the whole instead of only a part of his interest in the oil royalty. Although the interest of C. C. Clemmens in the land leased, in keeping with the provision in the lease, and in view of the evidence, be reduced to "less than the entire fee simple title," yet in legal consequence of the grant, not a part only of his interest, but his entire undivided one-half of the whole tract would be included in and covered by the mineral deed. The case of Hoffman, supra, is not decisive of a contrary view and involves a different point of controversy.
It is urged, secondly, that: "The case should have been submitted to the jury as to the intention of the parties, as mutual mistake was pleaded and the evidence showed that C. C. Clemmens thought he owned the entire 60 acres at the time of making the mineral deed and the grantee thought that C. C. Clemmens owned the entire 60 acres, and C. C. Clemmens testified that he only intended to sell one-half of the royalties due him under the B. A. Skipper lease."
The above statement is substantially the point of controversy. The error of the written instrument as pleaded was that of inadvertently and by mistake placing in the mineral deed of October 23, 1930, a conveyance of the grantors' "one half interest to the entire 60-acre tract," instead of "one half of grantors' one-half of the minerals in and under said 60-acre tract"; that it was the mutual agreement of both grantors and grantees "to convey to said grantees an undivided one half of grantors' undivided one-half interest, which is the equivalent of one-fourth of the said 60-acre tract, and it was not the intention to convey a greater interest in the minerals than the said one-half interest." The reformation of the instrument was sought so as to effect that change as pleaded. We conclude that the trial court has correctly ruled that the evidence did not establish that the embodying in the deed of the words "an undivided one-half interest," as used in the passing of the estate in particular described 60 acres of land was by mutual mistake and inadvertently done. According to the evidence the parties made no mistake in the preparation and drafting of the conveyance. The evidence likewise shows that C. C. Clemmens actually made sale, and L. T. Zeigler, acting for himself and associates, actually purchased, a one-half undivided interest of the royalty in the entire 60 acres, in the belief that C. C. Clemmens owned the entire 60-acre tract; that the negotiations between the parties for the sale and purchase of the royalty was on the basis of $6 an acre for 30 acres of the 60 acres, aggregating $180. Mr. C. C. Clemmens admitted that he sold and intended to sell "a half interest in my royalty of this 60 acres," in the thought and belief that "I owned the 60 acres of mineral rights." There was no mistake as to the terms, price, and quantity actually agreed upon. The single factual element appearing is that the parties had the mistaken idea that C. C. Clemmens owned the entire 60 acres of land. There is no evidence of an agreement between the parties whereby C. C. Clemmens agreed to convey to W. H. Kennedy and the others an interest of "one-half of C. C. Clemmens' one-half of the entire 60 acres or one-fourth of the royalty of the entire 60 acres." Quoting as applicable a well-established principle from Waco Tap Ry. Co. v. Shirley, 45 Tex. 355 : "It is, however, a well-established elementary principle, that, he `who seeks to rectify an instrument, on the ground of mistake, must be able to prove not only that there has been a mistake, but must be able to show exactly and precisely the form to which the deed ought to be brought, in order that it may be set right according to what was really intended, and must be able to establish, in the clearest and most satisfactory manner, that the alleged intention of the parties to which he desires to make it conformable, continued concurrently to the minds of all parties down to the time of its execution. The evidence must be such as to leave no fair and reasonable doubt upon the mind that the deed does not embody the final intention of the parties.'"
The rule is quoted and approved in Moore v. Giesecke, 76 Tex. 543, 13 S.W. 290. It appears in the evidence that at the time the sale and purchase of the one-half interest in the royalty was made the parties had the mistaken idea that C. C. Clemmens owned the entire 60-acre tract. In the evidence, however, equitable relief of reformation of the deed may not be granted to the grantor, Clemmens, from the consequences of the mistaken idea simply and of itself, not accompanied by fraud or any inequitable conduct of the grantees. It is clear and undisputed in the evidence that the actual agreement was of sale and purchase of 30 acres for $180, and the terms of the agreement were performed and the deed truly embodies and reflects such actual agreement. The court cannot change the contract actually made and truly embodied in the written instrument. Neither can the court make a new contract for the parties. The pleading asks only to have the deed "reformed so as to speak the true intent of the parties and that the same shall, when so reformed, convey but one-half of grantors' one-half interest in said 60-acre tract." The point is not properly before us, and is entirely aside, of whether equity can grant relief of cancellation, if pleaded and proved in a particular case, of a contract which a party did not intend to make or which he would not have entered into at all events had its effect been understood.
The judgment is affirmed.