Inland Waterways Pipe Line Co. v. Lipstate

78 S.W.2d 240
CourtCourt of Appeals of Texas
DecidedOctober 26, 1934
DocketNo. 13037
StatusPublished
Cited by3 cases

This text of 78 S.W.2d 240 (Inland Waterways Pipe Line Co. v. Lipstate) 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
Inland Waterways Pipe Line Co. v. Lipstate, 78 S.W.2d 240 (Tex. Ct. App. 1934).

Opinion

DUNKLIN, Chief Justice.

In December, 1931, the Wissman Oil Company drilled an oil well on 5.08 acres of land in Rusk county, known as the McElroy lease. The well was a producer, and was operated by that company under the management of its representative, Nat Wissman, until May 27, 1932, when it was placed in charge of Col. Paul Tucker, receiver, appointed by the [241]*241district court of Smith County, who operated it until August 9, 1932. The Wissman Oil Company then resumed possession and operated the well during the remainder of August and throughout the month of September, 1932. When the well was finished, it was connected with the Inland Waterways Pipe Line Company, and all the oil produced from it during the year 1932 was turned into the pipe line of that company and was appropriated by it.

This suit was instituted by P. H. Lipstate, E. J. Koenig, L. W. Stieren, and Tom L. Tip-ton against the Inland Waterways Pipe Line Company to recover the value of 65,000 barrels of oil which plaintiffs alleged the defendant had illegally received and converted to its own use during the months of June, July, August, and September, 1932, because the same was in excess of the maximum amount allowable under the rules and regulations of the Railroad Commission of the state. They claimed title to the oil sued for as follows: W. J. Koenig, two-twelfths of one-eighth royalty; L. W. Stieren, two-twelfths of one-eighth royalty; Tom L. Tipton, five-twelfths of one-eighth royalty; P. H. Lip-state, one-fourth of the seven-eighths as an overriding royalty interest.

In addition to a plea of general denial, defendant pleaded specially that during the months in question it received oil from the well from Nat Wissman and the Wissman Oil Company and made full payment to said company and to plaintiffs for all the oil so received, with further allegations that it undertook to handle the oil upon assurances from plaintiffs that they owned good title thereto, hilt that subsequently defendant learned that plaintiffs deraigned title through certain persons claiming as heirs of Gabe Mc-Elroy, the record holder of title; that Gabe McElroy was still alive, and therefore plaintiffs never acquired title. According to further allegations, when defendant acquired that information, it required of plaintiffs a bond indemnifying it against demands of other claimants of such title and thereafter continued payment to plaintiffs as it had done theretofore for all the oil it received from the well, and all within the allowable fixed by the Railroad Commission.

Two special issues were submitted to the jury which, together with findings thereon, were as follows:

“Special Issue No. 1.
“Question: Do you find from a preponderance of the evidence that the defendant Inland Waterways Pipe Line Company, during the months of June, July, August and September, 1932, received from the lease in question any oil over and above the amount of oil paid for by said defendant?-
“Answer: Yes.
“Special Issue No. 2.
“Question: How many barrels of oil, if any, do you find from a preponderance of the evidence herein the defendant Inland Waterways Pipe Line Company received from said lease during the time inquired about in Special Issue No. 1 over and above the amount paid for by said defendant?
“Answer in the number of barrels, if any you find.
“Answer: 41,041.”
Judgment was rendered for plaintiffs for the market value of 41,041 barrels of oil at the price of 98 cents per barrel, which was apportioned between them on the basis alleged in their pleadings. -Supplementing the findings of the jury, the judgment includes the following recitals: “And it further appearing to the court that plaintiffs had conclusively established that they had good title to the respective interests which they asserted, as shown by regular chain of title, and further, the testimony being undisputed to the effect that defendant pipe line company recognized the interests of plaintiffs as they claim in this suit, in paying for the oil for which settlement had been made, the court, in view of such undisputed testimony, did not submit any issue of fact to the jury as to title.”

The statement of facts covers some five hundred pages, and we can do no more than briefly summarize its salient features bearing on the assignments of error to be determined.

When the well was finished, a pipe was laid connecting two oil tanks on the lease with defendant’s pipe line. In those two tanks oil from the well was collected; gauges were affixed for registering the amount of oil that flowed from the tanks into defendant’s pipe line. Defendant’s gauger would inspect those gauges, make a record of the amount of oil shown, and furnish reports thereof, one to the operator in charge, one to defendant’s office, and would also keep a copy for his own convenience.

As shown by their evidence, plaintiffs instituted their suit upon the theory that through collusion between Njat Wissman, representing the Wissman Oil Company, and certain of defendant’s representatives, chiefly James M. Cochran, the gauger who kept the records, [242]*242oil in excess of the amount allowable under the law had been run into defendant’s pipe line and for which excess plaintiffs had been paid nothing.

The record shows that defendant had from time to time rendered accounts of oil received by it from the well, and plaintiffs had received payment for their proportionate parts thereof; and neither in their pleadings nor by the testimony of any witness was a claim made that the oil so paid for was less than the amount allowable. Indeed, J. B. May, the president of defendant company, testified without contradiction that the oil for which it had accounted was the full amount of the allowable. It thus appears that plaintiffs’ demand was confined to the excess oil over and above the amount allowable by law.

There was no allegation in plaintiff’s pleadings nor testimony to show the amount of allowable oil fixed for any stated period of time, although witnesses were permitted without objection to testify whether the oil runs for stated periods were within or in excess of the amounts allowable.

Plaintiffs deraigned title to the oil from Gabe McElroy, the record holder, through deeds of conveyance executed by Am-bus Jack McElroy and Delia McElroy Sellers,a feme sole, as heirs of Gabe McElroy. As noted already, the defendant, in addition to a special denial, pleaded that Gabe McElroy was still alive. The burden was on plaintiffs to prove the death of Gabe McElroy in order to supply the missing link in their title. The only evidence offered to make such proof consisted of two affidavits, one by John (Bud) Flanagan, dated December 3, 1930, stating that he was 59 years old, was born in Rusk county, where he had lived all his life; that he had known Gabe McElroy and his wife, Vinnie McElroy; that Gabe McElroy died about nine years ago and Vinnie McElroy, his wife, died about sixteen years ago; and that Ambus Jack McElroy, a son, and Delia Mc-Elroy Sellers, a daughter, were the only surviving heirs of Gabe and Vinnie McElroy. That affidavit was filed and recorded in the deed records of Rusk county on January 28, 1931.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Western Guaranty Loan Co. v. Dean
309 S.W.2d 857 (Court of Appeals of Texas, 1957)
Satterfield v. Knippel
169 S.W.2d 795 (Court of Appeals of Texas, 1943)

Cite This Page — Counsel Stack

Bluebook (online)
78 S.W.2d 240, Counsel Stack Legal Research, https://law.counselstack.com/opinion/inland-waterways-pipe-line-co-v-lipstate-texapp-1934.