ESTES v. TEXAS CONSOLIDATED OILS
No. 12625.
Court of Civil Appeals of Texas. Galveston.
Jan. 14, 1954.
As we understand the authorities cited by the remaindermen, they simply hold that the statement of a specific amount in the bond sets a limit upon the liability thereunder. In Ferguson v. Ferguson, Tex. Civ.App., 69 S.W.2d 592, 595, the Court said that, “the sole object of naming the penalty in a bond is to fix the limit of the liability of the signers“. See also, Grand Lodge A. O. U. W. of Texas v. Cleghorn, 20 Tex.Civ.App. 134, 48 S.W. 750; Chesley v. Reinhardt, Tex. Civ.App., 300 S.W. 973. The amount prescribed in the tendered bonds, while not stated definitely in dollars and cents, because of the uncertainty of continuing production of oil, gas and other minerals, as well as the duration of the life estate, is given in terms so that a definitely fixed sum may be ascertained at any given time. The decree does not require that the bonds state a specified definite amount in dollars and cents. We are not here concerned with a bail bond or other similar statutory bond. The tendered bonds should be construed as written contracts, and in determining the rights and liabilities of the parties thereunder the same rules governing the interpretation of written contracts are applicable. Higginbotham v. Kyle, Tex. Com.App., 294 S.W. 531. In our opinion the tendered bonds so construed are in compliance with the judgment. It is our understanding that no question is raised as to the sufficiency of the surety. It, therefore, was the ministerial duty of the clerk to approve the tendered bonds. (It is stated in the application, that a bond in form similar to those now before us, will be tendered by the Flag Oil Corporation of Delaware, but such bond is not before us and we consequently make no order with reference thereto.)
The Clerk of the District Court of Brooks County is the proper custodian of the funds paid into the registry of the court, and the proper person to approve the bonds tendered in accordance with the judgment rendered. This Court, acting in accordance with the provisions of
The Clerk of this Court will return to Oscar Hinojosa, the District Clerk of Brooks County, Texas, the bonds heretofore tendered to him by Texas Osage Co-operative Royalty Pool, Inc., and R. L. House, together with a copy of this opinion. An alternative writ of mandamus will issue directing said District Clerk to approve such bonds or appear in person before this Court within ten days after receipt of such order and here show cause why such bonds should not be so approved.
Alternative writ of mandamus granted.
Johnson & Abney, Howard Lee Norris, Dallas, for appellee.
CODY, Justice.
This is an appeal from an order of the District Court of Harris County overruling defendant‘s plea of privilege to be sued in Dallas County, the place of his residence, as well as the principal place of business of plaintiff, a corporation. The exception re
The plaintiff alleged in its petition, which was duly incorporated in its controverting affidavit, that plaintiff and defendant are co-owners of two oil, gas and mineral leases on land located in Harris County, and that plaintiff operated said leases, and paid all the costs of lifting and marketing the oil and gas produced from said leases. Further, that plaintiff and defendant each received its and his pro rata income from the pipe line company to which same was delivered and sold. Further that defendant refused to bear his pro rata share of the cost of lifting and marketing said gas and oil.
Plaintiff further alleged that there is a formal partnership between the parties, but that defendant has acquiesced in plaintiff‘s lifting and marketing the oil and gas, and accepted his pro rata share of the sale price thereof. That in law and in fact the relationship between the parties constitutes a mining partnership in relationship to the leaseholds. That all expenditures by plaintiff have been necessary and reasonable, and that the amount so advanced, expended for the benefit of defendant‘s interest, amounts to the total of $1,534.74 as of December 31, 1952. Plaintiff further plead:
“Plaintiff says that by virtue of expenditures and advances made by it for defendant‘s benefit it has, in equity as the operating partner of the mining partnership, to the extent of advances made for defendant‘s account for the benefit of defendant‘s interests in the leaseholds, a lien upon defendant‘s interests and each of such interests, in the properties; * * *”
By a verified answer, defendant denied any mining partnership, etc.
The parties stipulated that the oil and gas leases are on property located in Harris County. The plaintiff filed a motion that the plea of privilege be overruled because it was stipulated that the property was located in Harris County, and that it appeared from the face of plaintiff‘s pleading that it had been plead that defendant owed plaintiff money, and that said debt was secured by an equitable lien upon property located in Harris County. The court granted such motion, and entered the order here appealed from.
Defendant predicates his appeal upon two points to the effect (1) That under the facts plead a lien did not, and could not, exist against defendant‘s property in favor of plaintiff, and (2) Assuming that an operating cotenant should have a lien against the nonoperating cotenant‘s freehold interest in the oil and gas for the cost of lifting and marketing the oil, no evidence was introduced in support of the allegations as to the costs incurred, or as to the reasonableness thereof.
It is clear that the question to be determined in this suit is whether the defendant is suable in Harris County by virtue of the provisions of
There is a conflict in the holdings of the Courts of Civil Appeals on this question,
It is elementary that a cotenant has the right to develop for oil, but at his peril and own expense. However, if he gets production he may have deducted therefrom all his reasonable costs. It served the convenience of plaintiff here, when he lifted the oil and gas in place, to sell and deliver it to the pipe line, not only from a bookkeeping standpoint, but it would add to the cost of the operation for plaintiff to undertake to segregate the interests before selling to the pipe line and disputes as to whether the division had been proper would inevitably arise. But however inconvenient it would have been to plaintiff, or however risky, or however costly, the production was in the possession of plaintiff as it was lifted, and before it was delivered into the pipe line. It was from the production that plaintiff, as a cotenant, was entitled to reimbursement, and not from the freehold estate.
No doubt, though the point is not in the case, if it had been reasonably necessary to drill an offset well to preserve the freehold estate, the freehold estate would have been answerable to plaintiff for the cost of its preservation. But where unquestionably the production is answerable for the cost of lifting and marketing it, and plaintiff in the process releases the production, it cannot claim a lien on the freehold as a substitute for the production which it has released.
We are constrained to hold that the court erred in overruling the plea of privilege, and here reverse such order and order the plea sustained, and the cause transferred to a District Court of Dallas County.
Reversed and rendered.
On Appellee‘s Motion for Rehearing
Appellee‘s able motion for rehearing has convinced us that, irrespective of whether the particular allegations of appellant‘s petition support the legal conclusion made therein, that a mining partnership exists between appellee and appellant, they will support appellee‘s conclusion that it has and is entitled to an equitable lien upon appellant‘s share in the jointly owned leases, to secure the payment of appellant‘s just share of the cost of operating the leases, including the expenditures necessary for repairs, re-work, which were necessary to preserve and keep in force the freehold estate, or the leases.
Even if appellant‘s allegations had not been sufficient to indicate that appellee was suing to recover appellant‘s just share of the costs necessary to preserve the freehold estate, we question now whether equity would relegate appellee to his legal remedy of running garnishments against the pipe line company just before it paid for the oil runs twice each month. In other words, appellee seems to us to have no adequate remedy at law, and in order to avoid a multitude of suits, appellee should be given a lien against appellant‘s share of the freehold. However, we base our holding upon the fact that appellant‘s allegations as to the expenses of operations, which were necessary to the preservation of the freehold estate, sustain appellee‘s allegations that he is entitled to the equitable lien which he has alleged.
We grant appellee‘s motion for rehearing, set aside our former judgment, and affirm the judgment of the trial court.