Danciger Oil & Refining Co. of Texas v. Christian

109 S.W.2d 980, 1937 Tex. App. LEXIS 1163
CourtCourt of Appeals of Texas
DecidedOctober 18, 1937
DocketNo. 10357.
StatusPublished
Cited by4 cases

This text of 109 S.W.2d 980 (Danciger Oil & Refining Co. of Texas v. Christian) 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
Danciger Oil & Refining Co. of Texas v. Christian, 109 S.W.2d 980, 1937 Tex. App. LEXIS 1163 (Tex. Ct. App. 1937).

Opinion

CODY, Justice.

This suit is one involving the right to recover rentals on a drilling rig, payable in oil production, and was brought by appellee Christian in a district court of Harris county, against the Danciger Oil & Refining Company, Batson Oil Company, and John A. Deering, appellees. The material allegations of plaintiff’s (appellee here) petition are, in substance:

That in October, 1932, an oil, gas, and mineral lease covering 103½ acres in the Donaho league, Hardin county, was acquired by Burt Exploration Company and W. *981 P. Luse, known as the Hooks lease. That the Hooks lease had been assigned to, and was owned by, defendant Danciger Company, at the time of the execution of the contracts between it and plaintiff (upon which this suit is based). That by the contract of October 7,1933, plaintiff was to furnish defendant Danciger Company a certain standard oil well rotary drilling rig with draw works and equipment to be used by •said defendant in drilling a well for oil or gas on the Hooks lease, known as Hooks Well No. 2, and for the use thereof said ■defendant was to pay plaintiff 'the sum of $1,500 per month, at Houston, in advance. That said defendant used such rented oil well drilling equipment of plaintiff, paying plaintiff the rentals agreed upon, until the 8th day of February, when the basis of the rentals was changed, effective February 12, 1934. That the change in question was ■effected by a written modification of the •original contract (which was also in writing), and as modified, the rental contract provided plaintiff should be entitled to receive, instead of the $1,500 in cash per ■month, the sum of $750 in cash, plus a payment to be made out of ½ of ⅞ of the first ■oil or gas produced, saved and sold from the Hooks lease, said oil and gas payment to be of the value of $1,500 per month. That defendant Danciger Company used plaintiff’s equipment under the modified rental contract for 141 days, and was liable to plaintiff for an oil payment in the sum of $7,050, as, if and when ¼ of ⅞ of the oil from said lease, of that value, was first run. That about July 18, 1934, defendant Danciger Company transferred the Hooks lease to Burt Exploration Company, to defendant Batson Company, and to J. B. McAdams, under an agreement whereby defendant Danciger Company should have the right to receive the sum of $40,000 out of ⅛ of ⅞ of any oil or gas that might thereafter be produced from the east half of such lease, That thereafter McAdams transferred his interest, reserving a ¾8 overriding royalty, to defendant Batson Company. That by written instrument dated September 10,1934, defendant Batson Company obligated itself to pay defendant Danciger Company $40,000 out of ⅛ of ⅞ of the first oil or gas thereafter produced and saved from the east half of 103¼ acres covered by the Hooks lease, and, later, Batson Company delivered written transfers to defendant John A. Deering of certain interests in the Hooks lease, subject, however, to the aforesaid McAdams overriding royalty, and subject to the right of the Danciger Company to the $40,000 oil payment out of the east half of the Hooks lease as aforesaid. That about the 9th of November, 1934, a well-producing oil was completed on the east half of the Hooks lease, which has produced an average of 100 barrels a day since its completion, of the reasonable value of $1 per barrel. That plaintiff (at the time of filing the petition) is entitled to his oil payment in the sum of $1,596,80 and is entitled to continue to receive the production from ¾ of ⅞ of the oil first run from the Hooks lease until he has received oil payment amounting to $7,050. That all defendants, before they acquired their interests, had actual and constructive knowledge of plaintiff’s claim and right to the rig rental payments to be made out of oil as provided in the rig rental contract as modified by the written contract aforesaid of February 8, 1934. That defendant Danci-ger Company kept and used plaintiff’s rig and equipment for 141 days, by reason of which said defendant is indebted to plaintiff in the sum of $7,050 payable as oil and gas may be produced from the Hooks lease, and as the sum may be realized out of ⅛ of ⅞ of the oil and gas produced and saved from the Hooks lease. That each of defendants have denied, and do now deny, that plaintiff has any right, title, or interest in the production from the Hooks lease. That defendant Danciger Company denies that it is indebted to plaintiff, and refuses to execute and deliver to plaintiff an assignment evidencing plaintiff’s interest in the production, as obligated to do by the terms of the modification contract of February 8, 1934. And that defendant Danciger Company is demanding of the other defendants, and of the Sun Oil, and of the Sun Pipe Line Companies, that there be delivered to it ⅛ of ⅞ of all the production from the Hooks lease, until it has received $40,000, and denies plaintiff is entitled to any part or interest therein; and the other defendants are claiming to own the balance of the ⅞, or working interest, of the Hooks lease, and are undertaking to sell and dispose of it as their own, and demanding that the Sun Companies aforesaid account to them therefor, and that none of the production or the proceeds therefrom be delivered to or paid over to plaintiff.

Then follows the prayer that plaintiff have judgment against the Danciger Company for $7,050, together with interest' thereon at the rate of 6 per cent, per annum, to be collected out of ½ of % of the produc *982 tion from the Hooks lease, or the proceeds therefrom, if, as, and when collected. Also that plaintiff have judgment for $1,596.80, representing his share of the oil already produced, to be credited against the debt of $7,050. Plaintiff prays for specific performance of the provision of the modification agreement of February 8, 1934, that Danciger Company execute, acknowledge, and deliver to plaintiff a valid assignment of the oil and gas produced and saved, constituting the oil payment rental for the use of plaintiff’s rig, or so much thereof as will make the sum of $7,050 when realized out of the production. Plaintiff also prays, in effect, to have the interests of the Batson Company and of Deering, in the Hooks lease, adjudged subordinate to plaintiff’s right to oil production therefrom in the amount of $7,050. The prayer contains an alternative request, should the court refuse to enforce specific performance on the part of Danciger Company, and so require it to execute a transfer of ¼ of ⅞ of the production until’ $7,050 has been paid, which does not seem necessary to detail, due to the disposition made of the case.

The defendants answered by general demurrers, special demurrers, and special answers. And Batson Company filed a cross-action to quiet title to their interests— but the further ’ nature of the pleadings, including plaintiff’s supplemental petitions, is not deemed necessary to- set forth here.

The case was tried before the court without a jury, and judgment was rendered in favor of plaintiff; and at the request of defendants, the court filed conclusions of law and fact; and defendants have appealed. What the trial court’s holding was, and what his conclusions of fact and law were, sufficiently appear herein below among the grounds urged by appellants for cause of reversal.

Defendants urge that plaintiff’s petition was fatally defective, and their general demurrer ought to have been sustained, specifying as to the particulars in which the petition was fatally defective, the following:

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Cite This Page — Counsel Stack

Bluebook (online)
109 S.W.2d 980, 1937 Tex. App. LEXIS 1163, Counsel Stack Legal Research, https://law.counselstack.com/opinion/danciger-oil-refining-co-of-texas-v-christian-texapp-1937.