*1 appeal forthwith This defendants property said be must dismissed and the against case judgment the defendants have a remanded. Defendants as well as $900.35; plaintiff plaintiff in the sum of will then have opportunity to pending as sent proceedings should remain evidence on these undecided issues. including to all not tried the deter- issues Appeal dismissed. any which mination additional amount might represent any special the value profit,
interest other than a manufacturer’s which the might defendants have
property plaintiff belonging to the of replevin any
under the writ dam- ages might to which be the defendants en-
titled on taking account of the and deten- property under of said by plaintiff tion PHILLIPS PETROLEUM CO. writ, including determination WILLIAMS et al. property commingled amount defendants’ there- property, value plaintiff’s Appeals, Court of Fifth Circuit. defendants damages to which any of and 27, 1946. Dec. taking and deten- might entitled for be Rehearing 11,1947. DeniedFeb. commingled, and property tion hear and determine retaining jurisdiction to case proceedings in this includ-
any further foregoing. ing the urging appealed that be- Defendants commingling defendants’ cause plaintiff by property with furnished to the return of fendants are entitled material, plaintiff’s as defend- as well ants’, judgment alternative a in the $14,000. except
It elementary prescribed instances statute appealable complete to be must parties and final as to all whole subject Craighead matter therein involved. Wilson, How, 199, 15 L.Ed. In re Prindible, Cir., In F.2d 21. the order
appealed except nothing settled
the court has found that defendants are entitled to recover manufacturer’s $900.35 deprived were profit defendants of which plaintiff. All of by the the other action case, including the determina issues property of defendants’ the amount tion of plaintiff’s commingled with and the amount damages defendants entitled as a result thereof and damages defendants be entitled as a plaintiff’s action expressly
result hearing. reserved future The Court could not have settled these issues as no
evidence on them had been offered either side.
724
SIBLEY, Judge, dissenting Circuit part. Foster, Sparks Warren and E. H. M. Amarillo, Tex., Rayburn L.
both of Hummer, Emery, Foster, R. B. and Don F. Bartlesville, Okl., appellant. all for of Culton, Byron Singleton E. and D. H. Amarillo, Tex., appellees. both for SIBLEY, HUTCHESON, Before
WALLER, Judges. Circuit
HUTCHESON, Judge. to, Brought accounting an and re covery of, royalties due as lessors royalties provision1 gas' lease,2 another gas oil and against number growing of suits Company3arising Petroleum out contro due amounts versies Panhapdle under leases field. Texas primarily put The claim forward plaintiff was: within the equal one-eighth 1 one-eighth pro- pay oil lessor' To “2nd. prem- proceeds year, payable saved from the leased duced ises.” the quarterly, each well for the each above.) found, (See note 1 while the same 2nd. where To-pay produced premises, lessor for and if used off the “3rd. gasoline, prem- and used well of£ manufacture from ises or oil in the used one-eighth, monthly payable royalty manufacture product royalty gas; prevailing market rate of one- at the proceeds, eighth of the at the mouth # # #19 well, payable monthly royal 2 specific provisions Making at produced vailing market rate.” on oil and on ties 3 Phillips wells, Record, oil 5 and from wells Cir., 485; Phillips provided: 146 F.2d Petroleum section Ochsner, premises 138; F.2d “In Co. consideration agrees. Bynum, Petroleum covenants lessee 196; Phillips To deliver of les- “1st. credit 155 Johnson, Cir., Co. v. cost, pipeline sor, in the to which free land, wells connect lessee computed royalties provision, upon “used should the market value premises,” well, not “used deter- off mouth of the ” mined gasoline; in the manner forth in the divi- set *3 due, therefore, “one-eighth gross of the sion and was transfer that all had * * * “one-eighth proceeds” scrupulously and not accounted in accord- ” gas; prevailing provisions and ance market rate for with the of those plaintiffs duty and plain- the defendant owed a to that now that tendered was to fully pay to them one- tiffs account to them and the amounts due in accordance with eighth proceeds provisions; of of the tak- gross (4) their statutes of limita- plaintiffs. under lease tions all en accrued more than years prior August 13, four an claim that if There alternative was royalty Owners fractional of interests un- regarded should taken as “used der the lease intervened the side of gasoline” of manufacture plaintiffs, putting substantially forward royalty “one-eighth pre- of the taking substantially same claims and vailing applicable, plain- market rate” as positions, replied same and defendant sub- tiffs were entitled to recover fair and stantially plaintiffs’ as it had done to claims. value, alleged reasonable was replica- filed full Plaintiffs and intervenors per since, plaintiffs m.c.f., alleged, 6^ tions, why gross proceeds setting out period question during the there had been provision pre- rather of the lease than the no prevailing price. provision vailing applied, market rate and defendant, alleging that none of the plaintiffs intervenors, and who had sold at the was mouth of the wells or signed alleging division orders that premises, used off the but all of it was used consideration, were without denied their gasoline” the manufacture of “in within binding force. royalty meaning covenant in the limitation, they As to the defense lease, moved dismiss the claim for an alleged fraud concealment on de- and accounting on the basis of statute, fendant’s had tolled the while gross proceeds gas. of the That mo- plaintiffs, impounded, whose funds had been denied, tion was an- pleaded agreement impound- for and the swer asserted several (1) defenses: A de- ing preventing running of the stat- nial was used off the ute. premises, affirmation that all of it was used for the of gasoline, manufacture A jury demanded and allowed de- was going directly some objection plaintiffs. plant to the over the fendant being exchanged equivalent appointment some requested aof master was used; amounts of which were plaintiffs objection so over of de- (2) allowed a denial during period question pre- theory fendant. that the Defendant’s there had been royalty clause vailing market rate and that the provision controlling rejected, and, was gas was per sum; m.c.f. 6$ objections, over the cause was extensive- (3) its and defendant had agreed ly before the master submitted heard writing royalty that the plaintiffs’ special jury issues4 4 “Special you period Issue No. 1: gas during What do April, ' preponderance find from a May 4, of the evidence 1940?” ' gross proceeds were the “Special the residue you Issue No. 3: Do find from gas taken from the wells on the preponderance Wil a of the evidence that April, 1934, through liams ranch from defendant, Phillips Company, Petroleum December, 1943?” suppressed and concealed from Interven- “Special you No. 2: Issue Do find from Early er Allen and A.S. Penix material preponderance a pertinent the' evidence that to a facts determination of the defendant, Phillips Company, gross proceeds gas during pe- suppressed and April, concealed from 1934, April, intervener riod 1940?” you
J. pertinent F. Forbes “Special material facts No. 4: Issue find Do gross proceeds a determination of the preponderance of the evidence that de- gas in Appellees proceeds clause of do theory deny that the swap question provision Judgment equivalent received in controlled. gasoline extract- plaintiffs and intervenors was carried
was entered for to defendant’s ing plants jury aggregate where the on the verdict ap- for oth- $155,331.50, defendant has from it and made use of the residue sum of That purposes. insist, pealed. They er however: gas for expression “use the lease primary contention main Appellant’s gasoline” royalty provision applicable is that the here ” only; peculiar meaning, “used obligating the defend- was that to situa- application limits its one-eighth pay *4 ant as only man- tions where the is used price, that the record vailing market where, is after gasoline, ufacture of returned, and made, the been verdict having extracted, pop- is the residue gasoline the is entirely erro- judgment entered the air; ped off the and that or wasted into by plaintiff theory advanced neous where, here, extract- gasoline after the payment for provision was that applicable ed, uses, it applied to other the residue is must re- judgment proceeds, the in may “used” not be said that the was to enter with directions versed gasoline within for trial anew. or for defendant meaning of the clause. urged appel- by contentions Subordinate payments made (1) are: That the lant record A careful examination -and into directly to intervenors gas and of what done with the as to was benefit of impounded for the account sup arguments in appellees’ evidence prescribed in the di- plaintiffs, basis on port theory leaves in no doubt of their us full constituted and transfer vision re for the whatever there basis due; amounts then payment of all and final meaning appellees special would stricted and district court assuming (2) that, question. gas, place upon clause in covenant, correctly construed the used„ sue, for which was support jury’s evidence does not ap for gasoline, the manufacture in erred ad- finding; (3) that court therefore, plicable royalty provision, is that report as evidence for master’s mitting the payment “prevailing of the for the market (4) jury; that the the consideration gas” for for and not that "the rate limitations bars the claims statute gross proceeds.” produced more than intervenors for prior filing roy of their inter- On careful consideration of years four a ventions; alty language clause in (5) identical with the question held clause in here and of facts recover entitled to unpaid. use of the with identical due Company, fendant, sonable value of the gas?” Roberts & from the raw natural from interveners concealed Olver, “Thereafter, Royalty day June, Inc., on the 8th Three-B Com- pertinent jury pany to a de- returned into Court its facts material verdict, received, gross proceeds accepted was termination filed; April, 1934, May duly being signed by during period said verdict foreman and in terms as fol- 1940?” “Special : 5: there Was lows Issue Jury, “We, price, term answer the as that is- gas produced you, charge, sues submitted in the for the as follows: fined to Special $1,- answer Issue No. “We 1: Williams well?” found, 206,629.55. you “Special If No. 6: have Issue price, Special state what “We answer Issue No. 2: Yes. Special you at “We answer Issue the time in No. 3: it to have been Yes. find Special “We answer Issue No. question.” 4: Yes. you Special “Special 7: If answer Issue “We No. 5: No. Issue No. Special price existing “We answer Issue No. no market 6: No. found there Special time, you answer further “We Issue -then an- No. 7: at $243,067.58.” the actual fair and rea- what was swer here, shown we held Petro- As one, so to contention the division Record, Cir., leum F.2d 485. and transfer with their dec definite Nothing nothing c^se, laration the record this that the market value of at appellees’ arguments, to with- causes us mouth of the well is to be measure anywise modify draw the views we of rights or lessors’ obligations, lessee’s expressed. in and The evidence offered provisions their clear pre and full ap- cisely of here case and made so much arriving value, agree we with pellees, support argument defendant, con- until withdrawn or modi fied, meaning “used” “used struing precise the word constitute the and definite only,” prevailing when practice basis payments, payments made in written, using the lease accordance and binding. are final pop- extracting very and then existence of this and numer air, ping without the residue into the litigations ous other which have arisen over tend- meaning relevance the issue which was it price and effect of market Certainly ered, provisions the lease. what mar over was the to it given not be the effect ascribed price ket and the fact *5 here, “only” agreements into reading fix, due, these the word sums may apply to clause so it will be held to from time be to time more or gasoline only less than the prevailing used for the manufacture price, give market popped air, support full the residue is into the and to payments if and make binding where, apply gaso- not after the and to made to settlements thereunder. Binding they are, extracted, however, residue to as respect line is directed payments is in accepted them, The fact that the residue is not made other uses. these di use made vision wasted but a valuable of it or transfer orders did not rewrite or undoubtedly had, supplant have, has should They contract. are bind rate, prevailing only bearing on the or ing market the time and extent that none, they prevailing been, if there is being or are acted on and made used for manufacture of basis payments, of settlements and practice making profitable since the new time given that notice is use not from settlements will not be made on the basis it, residue, provided vogue. them, been in they but of has binding. cease to be persons change But while use As to sign value who did not division or the gas payments it has added to in the lessee’s hands transfer made to and ac fact, importance is, cepted great by, economic as an or them, settlements made with rate,” or, provided fixing prevailing on the “the basis for in these market, prevailing equally if value be If, however, there will binding. therefore, the amount payments to be evidence shows not that the were paid upon provided in accordance with for it the received lessors basis in these contract, agreements, it basis fixed is without but that were received upon merely payments effect determination of what tendered the com pany accepted by means. recipients contract on the and in the faith belief that were being the cause was Since tried below on a paid them, the amount due accept mere completely theory, and erroneous because it payments ance of these would not consti was, judgment must be reversed and tute accord and satisfaction or a binding remanded for further proceedings cause settlement.5 herewith, unnecessary accordance us discuss four, consider other As to contention the statute appellant limitations, quite plain, contentions of the errors of it is think, we trial, except us, committed on its conten- on record before as to the in four, five, one, which have tions whose funds do tervenors impounded, not which, matters retrial in accord- the statute limitations has been running, herewith, will have be determined. jury’s ance no basis for the fmd- Producing Pardue, 225, Union Co. v. 227. Texas, as opinion, the value of ing was fraud that there in this the cases On an- tolled the statute.6 fendant which difficult show, very court some- hitherto trial, -is shown unless it done to fix. thing and fraudulent affirmative keep toor to deceive lessors fact that in ignorance of the report- paid them were not amounts should truly, limitation
ed the defense of be sustained.7 five,
As to contention allowed, be whatever et MOTORS v. GENERAL BUCHANAN al. Texas, of the state of law CORPORATION. properly of interest was whether 34, 20287. Docket No. denied John son, we think Appeals, Second Circuit. Court which, in accordance on retrial sums Jan. herewith, may be due found rate, if basis of rate, of value prevailing market is no taken, allowed interest should be sums date due.
became *6 reversed and the cause not inconsist- is remanded for further proceedings. ent SIBLEY, Judge (dissenting in part).
I
disposition
of the case
concur in
opinion except
paragraph.
the last
do
think that interest will
allowable
I
be had. The
ques-
Texas statutes and decisions
unliquidated
tion of interest
sums due
plain.
written contracts are not
Johnson,
court in
185,
best
Cir.,
5
155 F.2d
did
to follow
by distinguishing
situations in which
payable
have been
could
ascertained
sum
certainty
the debtor
reasonable
in which trial
evidence was
from those
necessary
it. That
fairly
to ascertain
dis-
applied
allow
here would
tinction
market .rate for
if
price
a definite
a market
But
fact.
interest should be
ascertainable
certain market
if
denied
gas had to be
fair value of the
as-
Value is a matter of
by a trial.
certained
Steele,
996;
Tex.Sup.,
6
Producing Development
page
&
v.
Hickok
Glenn
810;
Sipper,
183;
Co.,
v. Texas
Phil
Sherman v.
137 Tex.
S.W.2d
Johnson,
85,
319,
lips