*1 Fullеr name was held that was not entitled have his It independent an as candidate for that office. certified obligation While legal, only moral and not nevertheless held to be being discretionary granting writ not one such fight, moral it would be refused those who in violation of the obligations hands.” not to into court “with clean said come any legislature prescribe restrictions has not seen fit seeking independent as an candidate one to be certified generally. prescribed other than those for candidates 13.51, Code, were in effect Articles 13.50 and Election substantially man case form when the the same Wester opinion not be decided. are doctrine should We this contrary any extended further. statute In the absence apply we standard of moral ethics see no reason to stricter signers application. candidate law than the does August voting They pledge relator took the same myself support primary pledge “I am a Democrat primary.” Election Code. nominee Article 13.11 inquire having authority into Secretаry no of State being disqualified the facts dehors relator not the record and having primary, it follows reason of voted in second requirements legal right relator under the has shown a clear county respective the statues to his name certified to the have office Independent for the clerks in his candidate district as Attorney District. District for the 79th Judicial accordingly issue. prayed will The writ mandamus Opinion 20, 1954. delivered October dissenting. Associate Justice Smith et al Dr. et al v. D. H. Bolin P. K. Smith July 14, A-4398. 1954. No. Decided Rehearing October overruled (271 93) 2d Series *2 Brannan, Rogers Eggers, Montgomery, C. J. & Rob- Nelson Falls, ertson Robertson, & Sellers and Ernest all of Wichita ' - (cid:127). holding Appeals The Court of there Civil erred in genuine no hearing fact issue raised oh the evidence on the summary judgment, pre- defendants’ motion for which rendered impress mature disposition plaintiffs’ the trial court’s suit to gas controversy, constructive trust on the oil and leases in holding which he defendant’s formerly plaintiffs,-in -held in trust for his own name whis 488 no duty violation of a plaintiffs, refusing participation
them with him in such renewal leases. White, White v. 141 295; Texas 172 Munsey S.W. 2d Garitty, Mills & 754; 115 Texas 283 S.W. Johnson v. Peckham, 120 S.W. Kilgore Kilgore & Kilgore, John Dallas, E. for res- pondents. reply points Gee, of error. Collins v. 107 2d, 754, S.W. refused; writ of error Lubbock Grain v. Fer- Co. guson, 539; Winn, S.W. Warner v. Texas 2d 338. Mr. Justice opinion Smith delivered the of the Court. *3 appeal This summary judgment. petitioners is from a filed suit against equity against respondent, Bolin, the D. H. and respondents assigns,
the other who are his recover an Montague interest properties County, Texas, certain oil by a means of constructive trust. The trial court’s action granting respondent’s summary judgment motion for been has by affirmed Appeаls. the Court of Civil 261 2d 352. S.W. following
Petitioners assert the issues of fact were preclude raised which summary judgment: rendition 1. acquiring That in personal for his benefit renewals oil gas and duty fiduciary leases the Howard lands Bolin violated a petitioners.
2. That in for his leases on benefit farm-out fiduciary and Crownover tracts he violated a likewise duty 3. That obtained information in the done on ship the Howard leases while relation- active in a petitioners, partly purchase induced him farm-out and to obtain the renewal of the Howard lеases personal for his benefit. determining
In question material whether or not evidence, must, by issues of fact were raised the court under law, light first view all the evidence in the most favorable petitioners; disregard testimony; the conflicts in
489 every indulge, petitioners, intendment in favor of the White, reasonably evidence. v. deducible from the White Hull, 39, 295; 328, Fitz-Gerald Texas judgment proper summary is not if the 2d 256. A 237 S.W. by jury. or of fact determined a court evidence raises issues to be 17.26, pp. Practice, Vol. McDonald on Texas Sec. See Civil 1380,1382. agrеement a upon written
The suit was based parties on entered into between the December Whether petitioners relationship a between D. H. Bolin and the relationship continuous until as about June contended petitioners, separate or whether it was a series relationships by respondent, Bolin, distinct H. as contended D. question summary judgment, appeal fact. from a only question should Court determine the of whether or fact pleadings, issue raised affidavits evidence. evidence,
Some of the which raisеs a fact fact issues to the Howard is as follows: petitioners They are doctors and business men. engaged primarily
never Bolin, Respondent, oil H. business. D. actively engaged has been in the oil business more than years; respondent, Bolin, trusted D. H. complete integrity. confidence in his On December *4 partnership agreement, written they designated Mr. Bolin manager agreed as the partnership; they business pay of the to into the operations begin common fund to enable to two-thirds (2/3) respondent (1/3). thereof and one-third All funds were deposited be partnership, to the credit of the be checked .to only duly signed by Bolin, out on checks D. H. or under his direction. H. partnership D. Bolin alone transacted the business. partnership This was entered into at the solicitation of res- pondent, during H.D. Bolin. period At no time the from Decem- 1, June, 1950, ber 1946 until sometime peti- in did he inform acting tioners that he was not under terms the of the written agreement partnership agree- of December 1946. The written provided ment parties that the business activities of the should long might continuе parties mutually Respond- so as the desire. drilling ent property, also acted as in contractor wells on leased which property included referred the Howard leases Montague County, leases, Texas. The Howard as well as all leases, originally other taken in the name of D. H. Bolin. expire Howard leases were on March 1950. When ,to 195.0, February in. renewals or extensions secure-
a^ke.d, partnership, replied: Mr. for: the “We leases Howard. get get wings-and- fly cé.ühj.no we could to Heav more then When, urged, this еn November obtain afternoon.” partnership leases,. for the on Mr. the Gist .farm-ou't the. advised., petitioners Bólin one of he had' checked the geology in those and was not interested farm-outs. On March 10th, expiration leases, respond 9th or of Howard before began negotiations Company with. of Texas ent Standard Oil Company, Bend Oil owners of the Gist and and. Crownover obtaining respondent farm-outs on these resulted agreement 4, 1950, April leases. was The farm-out dated two by respondent, Bolin, approved accepted H. D. on lÜay 10th, 1950, March March Oil 1950. On 9th or Standard Company geology in the showed area. Texas Bespondent two on the. had drilled wells Howard theretofore Oliver, leases,- dry superintendent both of Standard holes. G. W. wells, drilling Company Texas, that the of the two Oil testified to the on the Howard lands did contribute picture Bespondent knew these overall in the area. original expiration leases. Mr. facts Howard before geo from testified that all this had value Oliver information logical-point the two of view. Prior to the wеlls urged respondent lands, one had tibe the How drill the Howard well in the northwest corner of #2 been nearer and more ad ard jacent This location would have lands. Mr. Bolin drilled to the and Crownover farm-outs. corner, hole. On March southeast and the well report 10th, 1950, respondent before 9th or him geologist, Kendall, reef condi N. A. which reflected that a local report seemed made Stand tion indicated.' Kendall’s was also February Mr. Company Ken ard Oil of Texas on 1950. When force, report leases were dall mаde this the Howard still according original agreement effect, contention was in “* * * following: report as to contains 32,0 location, your inquiry our on the west acres about next undecided, tract, yet are that the Howard we are but chances try possibility, it since we want to define 1900-ft. reef suggest you a loca If could did have oil show. folks substantial time can fur purpose and at the same tion that would suit this *5 you, we would be value to information that would be of nish probably get together will you. Inasmuch we glad to with as days, we up present 10 would wind our well in next week or agreed by that time.” joint like to have an eventual location by Company, A. report signed N. The “Bolin Oil letter was - Kendall;”; 491 10th, 1950, March 9th or re- that on evidence shows The negotia- geological gained information. spondent further obtaining the farm-outs and the tions resulted completed a on the land was leases. The well Gist repre- June, Respondent producer first 1950. commercial Company petitioners of Texas was sented to that Standard Oil later, pro- wells, producer then admitted he was the these produced had the Howard leases. The well was ducer also lime, as men- from the or “Crinoidal” the same “Cronoidal” February 6, Respondent acquired report of tioned in the 1950. June, 1950, on the renewal leases the Howard lands before completion well. Howard lands of the Gist The wells on the producing are from the same formation as the lease. There producing were eleven wells on Howard lands at the time hearing summary judgment. motion for The re- spondent petitioners part opеrating billed for their ex- pense, they paid holes, part their for all the but when finally produced they oil was were told had no in- producing terest wells. The statement of facts consists of pages. 728 wishWe to reiterate that dowe not decide the evi- against party, dence favor of or either but we hold it raises a question questions fact or fact as to the Howard leases to be de- by jury, a termined trial court or and not this Court or the Appeals. Court of Civil geological knowledge
The extent of the and information ob- by development tained D. H. Bolin in lands, of the Howard jointly petitioners, with and whether this information motivating acquisition circumstance in his of renewal covering principally the Howard lands are matters within the mind of Mr. Bolin. respect knowledge rule to the use of or information one who stands in a confidential or relationship is Law,
well Restitution, stated in 200; Chap. 12, Restatement of the Hull, supra; Pomroy’s Sec. Equity Fitz-Gerald v. Juris- prudence, Ed., 3, par. ; 4th Elick, Vol. 1050 Schiller v. 997; Salmon, Meinhard v. 249 N.Y. 1; Drilling N.E. 62 A.L.R. Ballard Company, v. Claude Kan. 88 Pac. 2d Salmon, supra, negotiаted
In the case of Meinhard v. Salmon property obtained for himself a new lease certain had been under operating lease Salmon Meinhard undér joint agreement. manager venture Salmon was the sole property.- adjoining The new lease property included some *6 original in the lease. The
included
court sustained Meinhard’s
property,
original
interest
suit
establish his
both the
property,
adjoining
theory
and the
on the
of constructive trust
court,
opinion by
Cardozo,
for his benefit. The
in an
Chief Justice
(
“Joint continues, enterprise duty loyalty. Many the finest permissible workaday of conduct in a for forms ing world act- those length by fiduciary at arm’s are forbidden to those bound something ties. A trustee is held to stricter than the morals of the alone, place. honesty punctilio Not market but honor the sensitive, then the most is standard behavior. As this there unbending developed has a tradition that is and inveterate. Un- rigidity compromising equity has been the attitude of courts of petitioned loyalty by to undermine when thе rule of undivided ‘disintegrating particular exceptions. erosion’ of Wendt v. Fischer, 444, (154 303). Only 243 N.Y. N.E. thus has the kept higher for at conduct fiduciaries been a level than level of consciously the crowd. It will not trodden be lowered that by any judgment of this court.” managing partner enterprise, of their re-
As partners greater duty loyalty his a spondent owed even than normally required. case, supra, In the Meinhard v. Salmon put position a “Salmon had himself in the court said: in which thought renounced, abnega- of self was to be however hard the managing more coadventurer. tion. He was than He was a co- * * * him, For him and for those like adventurer. the rule loyalty supreme.” is relentless and MacDonald undivided Follett, 2d 334. through Kendall, Company, Mr. its
When Oil made geological report Company February 6, Oil to Standard original expired. Respondent had not managing partnership, performing wells obligations agreement under 1946. Un- December evidence, der the could have believed owned Standard right in his own and that no one else was inter- lease fact, holding he the lease fоr himself ested. “* * * case, supra, and the As said in the Salmon pre-emptive privilege, or, pre-emptive opportunity, better the enterprise, appropriated that was an incident Salmon thus might silence, secrecy Mein- to himself in He have warned submitted, plan hard that the and that either would be been this, compete free to for the award. If he had done do we duty, if say under a success- need he would have whether been acquired competition, so bene- ful in the to hold the lease prolong end, indireс- fit of a about to thus venture then *7 responsibilities conduct tion its and duties. The trouble about his any to from com- is that he his coadventurer chance excluded opportunity pete, any enjoy that from for benefit chance to agency. chance, had nothing if come to him alone virtue his This of price more, duty to concede. The of its he was under a option denial is an for the of the trust at the and bene- extension fit of the one whom excluded.” he alleged reposed they confidence
Petitionеrs that utmost proved and trust respondent D. H. Petitioners said Bolin. many reports them made with to the reference they paid many holes and out thousands dollars such
operations, they expense participated incident to securing information obtained personal advantage and later used his exclusion and to the petitioners. alleged respondent, Bolin, H. Petitioners D. “* * * wilfully negotiations plaintiffs concealed from these acquire adjoining farm-outs on said leases.” While actually the new leases on lаnds were not the Howard 12, 1950, obtained until presents after March the evidence a fact fiduciary issue as relationship to whether at the time existed acquisition rights of such in the name of Bolin the exclu sion of supra, Hull, This Court in Case of Fitz-Gerald (150 261), Texas 237 S.W. 2d said: “ fiduciary ‘While a relationship confidential or does not in give trust, itself to a rise constructive abuse of confidence rendering acquisition property by person or retention one against generally ground equi- unconscionable another suffices table relief in fоrm of the declaration and enforcement of a trust, and the constructive are careful not limit the courts scope application by rule or the of its a narrow definition of relationships protected by or confidential it. An abuse may of confidence within an abuse of a techni- rule be either fiduciary relationship relationship cal or of an informal where person another, one trusts relies whether rela- tionship moral, social, domestic, merely personal is a or one.’ Jur., ‘Trusts,’ p. Sec. 54 Am. 173.” application judgment
Thes summary rule well stated is 17.26, Practice, pp. McDonald on Texas Civil Vol. Sec. Penn, 1380 and and in the case Gulbenkian v. 929, 931, latter, In the 252 S.W. this Court said:
“* * * duty hearing summary of the court motion any judgment is to determine if there are issues of fact to be tried, weigh credibility, and not to the evidence or determine its v v v general credibility
“The rule is that if a motion involves the showings deponents, weight or, affiants or the it said, ground inference, granted a mere the motion will not be correctly opinion
We are of the that the trial court sustained regard respondent’s summary judgment motion for property described as Crownover court and the therefore as to such leases action of the trial *8 Appeals of Civil is sustained. Court action, prayed petitioners, part of as a of their cause The accounting appointment auditor to audit of an and the for part- kept by with the partnership Bolin in connection books the nership. granting respondent’s the trial in The action of court prayer summary judgment the for an ac- also deniеd motion for action, counting. Appeals affirmed has such The Civil Court of accounting delay upon rental plea except for an as paid leases in 1948 and on the Howard land payments due and accounting partner- dissolution of and as to the complain ship 1946. The does of December accounting. plea for judgment as to the of reversal Appeals affirmed as to judgment is Court of Civil The accounting judgments court trial plea and the for an property de- Appeals affirmed as to and of Civil are Court and reversed farm-out leases and Crownover scribed as Gist as to for trial the merits and remanded to the trial court Howard leases.
Opinion July 14, delivered Culver, joined
Mr. and Wil- Justice: Justices Garwood son, dissenting. majority opinion it
I in so far as holds dissent from the respect For the rea- there the Howard leases. is fact issue
¡495 ,s.oclosely leases interwoven the Howard 'son .the-matter acquisition Bolin of the .-pertaining with facts may appropriate “farm-outs,” be to discuss it and Crownovér (cid:127) phases .case.- both of the agreement 1, 1946,-the рarties entered into an On December (set Partnership” forth in the Court “Articles of denominated Civil opinion).- Appeals were All business though men, professional all time that one it known to at the was - engaged Smith, petitioners, theretofore been ventures; primarily and had been in oil Bolin was others drilling thirty years properties and for and oil over petitioners and operations. Bolin was his own The to continue period years. acquaintances and friends over proposed partners undertaken to the other Each venture accepted. mutually project Bolin’s first based 6, 1946, had three letter of December -to the effect that he County, per Oklahoma blocks of leases Comanche at acre $8.00 partnership at and the would that valuation. reimburse him nonproductive. proved wells be drilled thereon payable drew on the account to himself checks purchase expenses ren- leases accounting partners. dered detailed to his May of 1947 Bolin informed that he had ob- his associates Montague County, Texas, tained some 580 acres known as the properties recommended that these be tested. May 12, On letter to them Bolin stated: *9 “Therefore, believing good having place a the it is to drill and approval Denny Denney, Nail, Smith, of Messrs. E. A. Gale you agreeable proceed I it would like to know from all if of acreage to drill two wells on this the have on same basis that we drilled, acreage exception heretofore one the will the per group.” (S.F. 535-536) be about acre to the $7.00 original point withdrew, At this two of the members Doctors Arrington Reagan, by whose interests were taken Theo over by Smith, original Beck and partners. Dr. one of the first completed dry September well drilled was as a hole 1947 accounting by and an showing partners Bolin to his in detail rendered drilling expenses $10,776.87.
the He had theretofore partnership reimbursed himself out for the cost of funds per the 580-acre In Octo- at acre. block $6.00 year partner ber the same sent each a statement up Therefore, by credits and debits to that date. thе end original paid for, Howard land leases had been and all of by group drilling the bills op- created first in the Oklahoma paid. expenses by erations been incurred the second group drilling the first on well the Howard land leases had defrayed money originally been and all of contributed During parties year delay was exhausted. 1947 the rentals paid consequently were on three Oklahoma blocks and expired. July arranged those leases of 1948 Bolin for the drilling of a leases, resulting second well on the Howard land “dry hole.” August 18, сalling petitioners On Bolin wrote the their expire early attention to fact that the leases would in 1950 drilling stating wells, recommended the of two more probably result, unwilling while holes would he was to have expire drilling any further pre- without and that if participate ferred not to he would take over their interest. The Company agreed Standard Oil to contribute toward the cost of drilling. proved unproductive. It to be partici- Smith declined to drilling pate and, fact, engaged in the of this well was then Only of some wells elsewhere. threе of the agreed participate paid prorata part expense. their of the agreed pay years A fourth but failed to until some two later at filing suit time when he tendered a check to Bolin, accepted. operations that was not No further were con- original and the ducted leases covered the expired Howard lands on March Oliver, Exploration Superintendent Division
G. W. of Stand- Company, testified ard Oil that for the first he received time authority company from his about March to drill some company’s prior leases on “farm-out basis” and that a “farm-out” would not time have been considered. He there- proposed parties such a contract several and other mem- efforts, proposals made bers of rejected. staff similar all of which negotiations resulting He then entered into with Bolin acceptance proposal May 1950, by on Standard the terms of which Bolin drill wells three at an estimated $30,000 cost of or more the Gist and Crownover lands. Bolin sought expense opera- find then someone to share of these tions, contracting ultimately people, *10 with certain California also who, herein, agreed defendants bear two-thirds of esti- expense interest, proportionate mated in consideration of Bolin agreeing remaining carry one-third. completed well
On June first as a hole following began day and on Bolin of a well on lease, shortly completed the Gist which was thereafter as a com- producer. mercial day the 19th
On of June when Bolin first knew that “producer,” farm-out was a he аuthorized a broker to secure leases from the fee owners of the Howard land which were ob- per tained for Bolin at a cost of acre. This was the same $15.00 formerly land on which leases had partnership been owned expired and which had in March of 1950. agree majority I opinion with the Ap- the Court Civil
peals discharged raising have not the burden of an issue of fact and that properly trial court entered sum- mary judgment respondents. in favor of
Petitioner Smith testified that he had on more than one occа- urged sion acquire Bolin to the farm-out leases. His insistence exploration nearby founded on some which he had done a member of a partnership. finally, former Bolin toward the end November, 1949, replied geology thoroughly that the had been checked. No merit was found in it and he was not further in- terested. my opinion testimony is not sufficient to show vio- any fiduciary
lation of relationship. ventures separate agreed each on a basis and parties all of the operations before obligation commеnced. I see no part on Bolin’s after the farm-outs to peti- have offered them to the participation. tioners for petitioners’ comport Bolin’s conduct does not enjoying contention. He was a friendly still rela- tionship with them. It is unreasonable to conclude that he would strangers search out in California if peti- he had believed that tioners would putting be interested to the up extent of the nec- essary $22,000 in this venture. respect leases,
With to the Howard considerable store is laid testimony petitioners, Nail, of one of the who related a February just conversation with Bolin in expiration prior of 1950 urged in which Nail Bolin to get a renewal or an extension of the Howard leases for the mem- partnership. replied, get bers of the could “We no more get wings fly than we could to Heaven this afternoon.” may given Now whatever credence Nail have statement there is no indication that it was relied on to his detriment *11 any Bolin’s-part-.to inference intention on- created secure of. - himself; expiration -For three months after:
the. ^eases'for n unleased,' willing lay- any buy available the lands all .beyond-doubt, pay price. The fact seems be established not until and on account of the that Bolin that it was Gist well reacquisition in the interested Howard leases. This became adjoining south center of a tract was located 100-acre well only on the north and at-most a few hundred the Howard' leases - away.-. feet my opinion there It is are no facts nor inferences fiduciary relationship support violation of a the claimеd showing obtaining by Bolin of no these leases. There seems be drilling geological any information obtained done on arrangement effec- while the was the Howard leases purchase the farm-out or to ob- that induced Bolin to tive personal for his benefit. the renewal of Howard leases tain general respond- Many in this area. The wells had been drilled prospecting for Bolin, had on own account been active in ent vicinity. Unquestionably each well added oil and say data, from picture, obtained but part partnership in the extreme south wells drilled the realm of a causative factor enters the Howard speculation. evidence, my opinion, issue of fact fails to raise-an jury determination and there- to be submitted to for sufficient Willoughby proper. summary judgment respondents
fore 508; Jones, Em- 2d Fowler v. Texas 251 S.W. v. Co., App., wr. ref. ployers Texas Civ. 237 S.W. Insurance Appeals. judgment of the of Civil I affirm the Court would July Opinion 1954. delivered Rehearing 13, 1954. overruled October Vega Grieger Matilda
Fred July 1954. No. A-4577. Decided Rehearing overruled Ootober 85) (271 Series S.W. 2d