Stalter v. Gibson
2010 Ark. App. 801
| Ark. Ct. App. | 2010Background
- Salles: 170-acre parcel; deed at issue had no mineral-rights reservation.
- 1992 contract reserved half the mineral rights to the Stalters and promised Gibsons half the mineral proceeds upon paying down to $35,000; 1992 warranty deed likewise reserved half the minerals.
- Escrow: the 1992 deed was deposited for safekeeping with a bank.
- 2004: three successive deeds prepared by others omitted mineral rights; Stalters signed all, but recording problems halted the deeds.
- 2004 November deed finally recorded with no mineral-rights reservation; in 2006, dispute arose when Stalters learned of the omission and sued to set aside or reform; trial court denied reform and later the issue of parol evidence and character evidence arose.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Reformation of the 2004 deed based on mutual mistake | Stalters: 1992 contract clearly reserved minerals; 2004 omission due to mutual mistake. | Gibsons: 1992 oral understanding allowed Gibsons to receive all minerals after full payment. | No clear error; reform denied. |
| Sufficiency of evidence of mutual mistake | Stalters—clear and convincing proof of mutual mistake. | Gibsons—no mutual mistake; 1992 terms reflected orally agreed understanding. | Not clearly erroneous; evidence insufficient to overturn. |
| Admissibility of parol evidence in reformation | Parol evidence improperly offered to vary/wr– reflect contract. | Parol evidence admissible to prove mutual mistake in reformation. | Admissible; no error. |
| Admission of character evidence for Dianne Gibson | Rule 608(a) improper; Gibson’s credibility attacked. | Judge did not abuse discretion; evidence admissible in bench trial. | No abuse; no prejudicial error. |
| Overall affirmance of circuit court’s rulings | Court should reform deed to reserve minerals. | Deed reflects true agreement; no reform. | Affirmed; relief denied. |
Key Cases Cited
- McCullough v. Leftwich, 232 Ark. 99, 334 S.W.2d 707 (1960) (mutual mistake and reformation reviewed on facts)
- Black v. Been, 230 Ark. 526, 323 S.W.2d 545 (1959) (reformation considerations based on facts and conflicts in the record)
- Turner v. Pennington, 7 Ark. App. 205, 646 S.W.2d 28 (1983) (two permissible views; not clearly erroneous)
- Morton v. Park View Apts., 315 Ark. 400, 868 S.W.2d 448 (1993) (parol evidence admissible in reformation cases for mutual mistake)
- Garot v. Hopkins, 266 Ark. 243, 583 S.W.2d 54 (1979) (mutual mistake evidence admissible in reformation context)
- Galyen v. Gillenwater, 247 Ark. 701, 447 S.W.2d 137 (1969) (binding reformation standard; factual conflicts govern)