Dale v. Case, Et Ux.

64 So. 2d 344, 217 Miss. 298, 28 Adv. S. 9, 2 Oil & Gas Rep. 962, 37 A.L.R. 2d 811, 1953 Miss. LEXIS 432
CourtMississippi Supreme Court
DecidedApril 20, 1953
Docket38533
StatusPublished
Cited by20 cases

This text of 64 So. 2d 344 (Dale v. Case, Et Ux.) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dale v. Case, Et Ux., 64 So. 2d 344, 217 Miss. 298, 28 Adv. S. 9, 2 Oil & Gas Rep. 962, 37 A.L.R. 2d 811, 1953 Miss. LEXIS 432 (Mich. 1953).

Opinion

*302 Kyle, J.

This case is before us on appeal by John Dale, Jr., and others, defendants in the court below, from a decree of the chancery court of Lincoln County rendered in favor of Zollie M. Case and his wife, Ruby Lee Case, com: plainants, in which the court held that a mineral deed executed by Zollie M. Case and his wife to John Dale, Jr., on August 10, 1945, did not convey to the-grantee therein a present interest in the outstanding oil, gas and mineral leases on the lands described in the mineral deed, but reserved to the grantors therein all rights, rentals and royalties accruing or to accrue to them as lessors under the leases executed prior to the date of said mineral deed. The court in its decree also held that the above mentioned mineral deed was unambiguous, and that the defendants, John Dale, Jr., and his grantees were not entitled to a reformation, as prayed for in their cross bill.

The facts upon which the case was decided are substantially as follows: On August 10, 1945, Zollie M. Case was the owner of approximately 339 acres of land in Section 18, Township 7 North, Range 7 East, in Lincoln County, which consisted of two separate tracts. One *303 tract of land contained 159 acres and constituted the homestead of Case and his wife; and Case’s title to that tract of land was subject to an outstanding oil, gas and mineral lease, which he and his wife had executed on June 19, 1937, in favor of J. H. Harrison, and which had later been assigned to the Stanolind Oil and Gras Company. The other tract of land, containing 180 acres, was a tract of land that Case had purchased from Hugh M. Callender and his wife in 1941; and Case’s title to that tract was subject to an oil, gas and mineral lease, which Callender and his wife had executed in favor of the Sun Oil Company on January 21, 1938. Case’s title to both tracts of land was also subject to a mineral deed conveyance of an undivided one-half interest in the oil, gas and other minerals on said lands executed by Case and his wife to J. H. Bond on January 23, 1943.

Each of the above mentioned oil, gas and mineral leases covered a primary term of ten years, and was to continue in force as long thereafter as oil, gas or other minerals were produced thereunder. The lease covering the 159-acre tract was to expire on June 19, 1947, unless production was had or drilling operations were begun prior to that date. The lease in favor of the Sun Oil Company covering the 180-acre tract was to expire on January 21, 1948, unless production was had or drilling operations were begun prior to that date.

On August 10,1945, Case and his wife executed to John Dale, Jr., a mineral right and royalty transfer instrument, in which they conveyed to John Dale, Jr., an undivided 20/339ths interest in the oil, gas and other minerals on the two tracts of land. A printed form was used in the preparation of the mineral instrument, and immediately following the granting clause and the description of the lands there was written into the instrument in typewritten form the following reservation, to wit: ‘ ‘ This deed shall not participate in present oil and gas lease, but shall participate in any and all such future leases.” The consideration recited in the instrument *304 was $100.00. R. Lee Stamps represented Dale in tlie purchase of the mineral interest. Stamps resided in Lincoln County and was secretary of the local Farm Loan Association and also represented the Federal Land Bank of New Orleans in the Brookhaven area. Stamps had had experience in negotiating for the purchase of mineral interests in that area for other persons. Case was a farmer who resided on the 159-acre tract of land; and Case testified that his education ended when he “went to school in the seventh grade at Beaver Creek.”

About two months after Dale had purchased the mineral interest from Case, Dale conveyed to R. B. Sharp and R. M. Strieker parts of his mineral interest; and on October 10, 1947, Dale conveyed to Cordon W. Culmon the remaining part of the mineral interest. These conveyances were made by deeds which contained the same reservation as that embraced in the deed which Dale had received from Case-.

During the fall of 1946 a dry hole was drilled on the 180-acre tract of land which was under lease to the Sun Oil Company; and on January 21, 1948, the mineral lease held by the Sun Oil Company on that tract was permitted to expire.

On May 9, 1947, the Stanolind Oil and Cas Company brought in a producing oil well on the Southeast Quarter of the Northeast Quarter of Section 18, which was a part of the 159-acre tract of land occupied by Case and his wife as a homestead. A few weeks later Stanolind prepared and circulated among the owners of royalty rights for their signatures a division order authorizing the payment of royalties to the persons named therein according to their respective interests. This order was dated August 27, 1947. The interest owned by Case and his wife, as shown on the reverse side of the division order, was “99,600/271,200 x 39/40 of %th.” Thereafter Case and his wife received a check for $1,568.92 in payment of royalties accrued during the period for which payment was made, and .other royalty payments were *305 made under the division order from month, to month until June 1, 1948, when the leasehold interest held by the Stanolind Oil and G-as Company in the 159-acre tract was unitized in what is known as the Brookhaven Field, with the California Company as the operating company. A new division order was then circulated and signed by the royalty owners, and royalties were thereafter paid by the California Company in accordance with the new division order. Case testified that he did not know that he was not being paid the royalty due him on the interest conveyed to Dale, subject to the above mentioned reservation, until sometime during the latter part of 1948 or the early part of 1949, when he learned from Graham Hicks, a representative of the California Company, that he was not being paid the royalty accruing on that interest; and in March, 1949, Case was informed that the royalty interest had been paid by the oil companies to Dale and his grantees.

Case and his wife filed their bill of complaint against Dale and his grantees and the oil companies on April 22, 1949. In their hill the complainants asked that their rights under the reservation contained in the mineral instrument dated August 10, 1945, be recognized and enforced, and that the oil companies be required to pay to them all the royalties due them under the lease dated June 19, 1937, and that the oil companies and the other defendants be required to account to them for the royalties improperly paid to Dale and his grantees prior to the date of the filing of the suit. Separate answers were filed by Dale and his grantees and by the oil companies. Dale and his grqntees made their answer a cross hill, and asked that the mineral instrument be reformed so as to show that the reservation contained therein applied only to the delay rentals provided for in the lease dated June 19, 1937, and that it did not apply to the royalties payable under the lease.

There was a sharp conflict in the testimony relating to the above mentioned reservation. Case testified that the *306

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Bluebook (online)
64 So. 2d 344, 217 Miss. 298, 28 Adv. S. 9, 2 Oil & Gas Rep. 962, 37 A.L.R. 2d 811, 1953 Miss. LEXIS 432, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dale-v-case-et-ux-miss-1953.