Chastain v. Cooper & Reed

250 S.W.2d 652, 1 Oil & Gas Rep. 1336, 1952 Tex. App. LEXIS 1647
CourtCourt of Appeals of Texas
DecidedJune 20, 1952
Docket14454
StatusPublished
Cited by8 cases

This text of 250 S.W.2d 652 (Chastain v. Cooper & Reed) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chastain v. Cooper & Reed, 250 S.W.2d 652, 1 Oil & Gas Rep. 1336, 1952 Tex. App. LEXIS 1647 (Tex. Ct. App. 1952).

Opinion

CRAMER, Justice.

This is a rather complicated lawsuit involving- a number of controversies growing out of the drilling of a well for oil and gas in what is known as Tri-Cities Field in Henderson County, Texas, and the failure of Humphrey Marshall to pay the drilling contractor and numerous other parties who furnished materials or performed work on said well. Numerous affidavits for liens were filed by parties who either intervened or were made parties-defendant. Whiteley-Phillips Drilling Company claimed under both an oral agreement with M. B. Chastain and a written contract with Marshall for the drilling of the well. Cooper & Reed and National Supply Company claimed their indebtedness was contracted directly by Chastain through his agent, George Mitch-am. Upon application of John W. Murchison, an intervener, R. B. Sanders was appointed receiver and the property has been, since such appointment, operated by such receiver. By agreement, Murchison’s plea of intervention was admitted by all parties and judgment entered awarding him recovery, as against all parties, o-f the leasehold estate on the lands covered by the leases, except the 173 acres embracing the well, and established his interest in an overriding ⅝ royalty in such 173-acre tract. The trial was to the court without a jury and resulted in a judgment in favor of Whiteley-Phillips against Chastain arid Marshall for a portion of the claim, and against Marshall, individually for the remainder. Cooper & Reed and the National Supply Company recovered judgment against Marshall and Chastain for the full amount of their claims plus attorney’s fees. National Supply’s lien was foreclosed and Cooper & Reed were denied a lien. I. S. Dolan recovered a money judgment against Marshall and a foreclosure of a lien, securing the debt, against the lease. In addition to- the above, judgment was entered against Marshall for a money judgment in favor of all parties claiming against him, from which parts of the judgment no appeal was taken.

Chastain has duly perfected this appeal and briefs 91 points of error.

The transcript contains 338 pages, the statement of facts 861 pages, and appellant’s brief 182 pages.

The record, material to all claim's by all appellees, is substantially as follows: The base lease was dated June- 20, 1948 with Patricia Ann Murchison, a feme sole, as lessor and John W. Murchison as lessee, and covered 482.03 acres of land. On August 17, 1948 John W. Murchison assigned said lease to Chastain, excepting therefrom an overriding royalty to himself of ⅛ of % of all the oil, gas and other minerals produced and saved from said land. In the assignment to Chastain he bound himself, his heirs and assigns, to commence operations for the drilling of a well for oil and gas within 30 days from date of the assignment, and to- prosecute the same with due diligence to a depth of 7,800 feet *654 unless oil and/or gas should ibe found in paying quantities at a lesser depth. It provided for an automatic reversion of title upon grantee’s failure to comply with such provision. On August 19, 1948 Chastain, by written assignment, transferred to Marshall three tracts of the land theretofore transferred to him by Murchison, excepting from such assignment and reserving to himself an interest in the amount of %2 of all the oil, gas and other minerals produced and saved from the land, ⅜2 of ⅞ to be an overriding royalty, and %2 of ⅞ to be a working interest; the overriding royalty to be free and clear of all costs and expenses except ad valorem and severance taxes assessed against such interest; the working interest to be free and clear of all costs of drilling, equipping, and completing into tanks on the first well only, but to bear its proportionate part of costs of drilling and completing into tanks on all subsequent wells. On November 9, 1948 Chastain assigned to H. P. Barton, subject to the full effect of the assignment to Chastain, a ½2 of the ⅞ working interest, free and clear of all expense of completing the first well, but to bear its proportionate part-of expenses of other wells. Marshall, after Chastain’s assignment to him, made numerous assignments out of his interest, of undivided working interests, to others, not parties to this suit. After he was served with process in this suit, Marshall left for parts unknown and was not present or represented at the trial.

Chastain defended all the claims asserted against him on the ground that he had assigned the lease to Marshall, reserving only a %2 of ⅞ interest free of drilling costs on the first well, and a ⅝ of ⅞ overriding royalty; that Marshall was obligated to drill the first well free of cost to him; that his connection with the drilling of the well and purchase of equipment was only for the purpose of assisting Marshall; that he was not a partner of, nor obligated for, or with, Marshall, for any of the costs of drilling the well.

Whiteley-Phillips, National Supply Company, and Cooper & Reed claimed Chastain personally contracted their obligations; that drilling operations were commenced on or about September 13 or 14, prior to the registration of Marshall’s assignments, at a time when Chastain was the record owner and in charge of the conduct of the drilling operations; and that Chastain and Marshall were actually engaged in a joint enterprise and were partners.

We will consider all of Chastain’s assignments with reference to the claim of Whiteley-Phillips together. They are in substance: There was no evidence to sustain the findings (1-2) that there was an oral contract between Whiteley-Phillips and Chastain for the drilling of the well under which Chastain moved on the lease; (3) that the parties did not mention Marshall, and Chastain represented that he owned the lease; (4) that thereafter Whiteley-Phillips commenced drilling operations.

The trial court erred in refusing to find (S) that it was contemplated by the parties, that the drilling contract would be in writing; (6) that the written contract dated September 20, 1948 between Marshall and Whiteley-Phillips was the only contract made for the drilling of the well; (7) and that there was never an oral contract for the drilling of the well.

(8) The court erred in finding that at the time Marshall signed the contract with Whiteley-Phillips agreeing to pay for all drilling operations, Whiteley-Phillips did not release Chastain; (9) that after Whiteley-Phillips received the October 28, 1948 letter, they prepared a contract to be signed by Chastain, Marshall, and Whiteley-Phillips on substantially the same terms as the oral contract, which contract Chastain refused to sign; and that Ellison Miles, for Whiteley-Phillips, did not agree to release Chastain from his prior obligations under the oral contract, but continued to claim that Chastain was liable thereunder; (10) that when Chastain’s name was marked out of the contract, and there was noted thereon, “All strike-outs of the name, M. B. Chastain, are approved,” it was not Whiteley-Phillips’ or Marshall’s intention that Chastain should be released on his oral' agreement; (11) Marshall’s attorney explained that the notation was to1 show that the change therein was made to avoid suspicion and not with the intention on the *655

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Cite This Page — Counsel Stack

Bluebook (online)
250 S.W.2d 652, 1 Oil & Gas Rep. 1336, 1952 Tex. App. LEXIS 1647, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chastain-v-cooper-reed-texapp-1952.