Johnson v. Garrett

297 S.W. 839, 174 Ark. 682, 1927 Ark. LEXIS 537
CourtSupreme Court of Arkansas
DecidedJuly 4, 1927
StatusPublished
Cited by1 cases

This text of 297 S.W. 839 (Johnson v. Garrett) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Johnson v. Garrett, 297 S.W. 839, 174 Ark. 682, 1927 Ark. LEXIS 537 (Ark. 1927).

Opinion

Humphreys, J.

. Appellees, J. M. Garrett and Joe Modisett, doing 'business under tbe firm name of Garrett & Modisett, instituted tbis suit in tbe second division of tbe circuit court of Union County to recover $18,625 from appellants, D. N. Johnson, J. B. Hawley and W. H. Flani-gan, doing business under tbe firm name of Smackover Petroleum Corporation, as a commission for effecting an alleged sale of an oil and gas lease located on tbe southeast one-quarter of section 34, township 15 south, range 15 west, Ouachita County, Arkansas, to tbe Phillips Petroleum Company for $375,000. It was alleged, in substance, in tbe complaint that appellants employed appel-lees to sell said lease, that they effected a sale theréof to tbe Phillips Petroleum Company for $375,000 in cash, and that a reasonable value for tbe service performed was 5 per cent, on tbe amount- received.

Appellees filed an answer, denying tbe material allegations of tbe complaint.

Tbe cause was submitted upon tbe pleadings, testimony adduced by tbe respective parties and instructions of the court, which resulted in a verdict and consequent judgment in favor of appellees for $18,750, from which is tbis appeal.

At tbe conclusion of tbe testimony appellants requested a peremptory instruction, which the court refused to give, and now seek a reversal of tbe judgment on tbe ground that tbe court erred in refusing to instruct a verdict in their favor, contending:

First. That tbe undisputed evidence reflects that no contract of employment for tbe sale of tbe lease was entered into between tbe parties.

Second. If such a contract was entered into, appel-lees performed no substantial services for appellants therein.

(1). Appellees were employed by appellants to drill an oil w.ell to deep sand on the leased premises, and brought in a producing- well of 12,000 barrels daily. Early Sunday morning May 24, 1925, a short time after the well came in, appellees and I). N. Johnson drove to El Dorado in a car. Appellants were inexperienced in the development and handling of oil properties, and desired to sell the lease for as much as possible. They had been advised by appellees to let agents, or what they called “lease-hounds” alone, else they would get them into trouble.

J. M. Garrett testified that, on the way to El Dorado, D. N. Johnson told him that he wanted to sell the property, and asked Mr. Modisett and himself to see if they could get a buyer for it; that, Sunday, he took Bob Matder, who represented the Humble Oil & Refining-Company, to the well to check it up, and • introduced him to appellants, who made them an offer for the property Monday morning, May 25. Matder was then stopping at the Garrett Hotel, and, while appellants were in his room discussing the trade, witness saW and approached ‘W. E. Thompson, with whom he was acquainted, and who represented the Phillips Petroleum Company, and had a conversation with him about purchasing the property; that witness arranged to take Thompson to see appellants at 11 o’clock; that Mr. Modisett called Matder’s, room over the telephone and advised J. B. Hawley not to close the deal with him, that they had a better offer; that, when Mr. Hawley came down the stairs, witness said to him and Mr. Johnson, “I have a competent buyer for the property from whom we can get more money; you be at your cottage at 11 o ’clock and I will have a man out there to make you an offer on the property;” that, at 11 o’clock, witness took Thompson out to the cottage in his car and introduced him to appellants — none of them knew him; that they began negotiations which resulted later in the sale of the lease for $375,000 to the Phillips Petroleum Company; that they had offices in the First National Bank at El Dorado, and were making- lots of sales in Nevada County at that time, but did not know whether they had sold any leases in Ouachita County, and could not remember any particular sales they made; that he paid a brokerage tax to sell leases in El Dorado in 1924, but did not for 1925, because they incorporated in 1925, about June;l; that, after-their sale of the lease, appellants settled with -them for drilling the well, at which time nothing was. said about the commission for making the sale of the lease...

Joe Modisett testified that, on the way to El Dorado the morning after the well came in, Johnson told Garrett and himself to go ahead and see what we could get for the lease; that we knew more about the lease than they did, and Go go ahead and see some of the men when we got to town, as he wanted to sell the lease;” that witness-asked Thompson why he did not buy the property, at which time he called Mr. Hawley from Mr. Matder’s room and told him not to close the deal with the Humble Oil & Refining Company, because Thompson, the Phillips Petroleum Company man, was there; that he was at the home of appellant when Garrett brought Thompson and introduced him to them; that he never thereafter disavowed any intention to. claim a commission.. . :

D. N. Johnson-testified that, after the well came in, he told Garrett and Modisett on the way to El Dorado that they wanted to sell the lease, but that he did not know that they were brokers; that Matder made an offer Sunday, the 24th, for the Humble Oil & Refining Company,. which they refused; that nothing further was done until- Garrett brought Thompson, representative of the Phillips Petroleum Company, out to the. house where they lived; that was the first intimation he had that Garrett had anything to do with the trade, and did not know that Garrett was. acting* or representing -them as a broker in trying to sell the lease; that he did not know that Garrett was claiming to- be a broker in handling the deal until June 10, after the property was sold on May 27; that they settled Avith Garrett and Modisett' for drilling the well after the sale of the lease, and made no claim for a commission at that time, nor afterwards when he saw them, until G-arrett wrote him, on July 10; that, some time after receiving the letter, he had a conversation with them, in which Garrett said he thought they ought, to have something, hut, in a conversation with Modisett after the first conversation referred to, he said that he did not make his money that way, and disavowed any intention of claiming a commission; that it is true that Modisett telephoned to Hawley, while they were in Matder’s room, not to close the deal, but that he attached no importance to it, and broke off with Matder because he did not offer what they wanted.

W. E. Thompson testified that he was interested in buying the lease for the Phillips Petroleum Company, and inspected it on his own motion on Sunday morning, the 24th; that he returned to El Dorado and that, by inquiry, he ascertained that D. N. Johnson was the president of the Smackover Petroleum Corporation that owned the lease; that later in the day he visited and checked up some of the surrounding wells; that on Monday morning, the 25th, he went to the Garrett Hotel; met Jimmy Garrett, and learned from him that D. N. Johnson and J. 'B.

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297 S.W. 839, 174 Ark. 682, 1927 Ark. LEXIS 537, Counsel Stack Legal Research, https://law.counselstack.com/opinion/johnson-v-garrett-ark-1927.