Larry Long and Woodbine Production Corporation v. Miken Oil, Inc. and Mike Tate
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Opinion
ACCEPTED 12-14-250-cv TWELFTH COURT OF APPEALS TYLER, TEXAS 1/13/2015 1:47:20 PM CATHY LUSK CLERK
CAUSE NO. 12-14-00250-CV
IN THE FILED IN 12th COURT OF APPEALS COURT OF APPEALS TYLER, TEXAS TWELFTH COURT OF APPEALS 1/13/2015 1:47:20 PM TYLER, TEXAS CATHY S. LUSK Clerk
LARRY LONG AND WOODBINE PRODUCTION CORPORATION, Appellants
V.
MIKEN OIL, INC. and MIKE TATE, Appellees ______________________________________________________________
On Appeal from the th 4 Judicial District Court of Rusk County, Texas The Honorable J. Clay Gossett, Presiding Judge ______________________________________________________________
BRIEF OF APPELLEES MIKEN OIL, INC. and MIKE TATE
Deborah J. Race Texas Bar No. 16448700 IRELAND, CARROLL & KELLEY, P.C. 6101 S. Broadway, Suite 500 Tyler, Texas 75703 Drace@icklaw.com Tel: (903) 561-1600 Fax: (903) 581-1071
ATTORNEY FOR APPELLEES
ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL
Pursuant to Tex. R. App. P. 52.3(a), the following is a complete list of all parties and the names and addresses of all counsel.
Appellants: Larry T. Long Woodbine Production Corporation
Appellate Counsel: F. Franklin Honea frank@honealaw.com The Law Offices of F. Franklin Honea 5949 Sherry Lane, Suite 1700 Dallas, Texas 75225
Trial Counsel: Ron Adkison ron@adkisonlawfirm.com The Adkison Law Firm 300 W. Main Street Henderson, Texas 75652-3109
Brent Bull Bull & Barrett, LLP Energy Centre 1127 Judson Road, Suite 120 Longview, Texas 75601
Appellees: Miken Oil, Inc. Mike Tate
Appellate Counsel: Deborah J. Race Drace@icklaw.com Ireland, Carroll & Kelley, P.C. 6101 S. Broadway, Suite 500 Tyler, Texas 75703
ii Trial Counsel: Charles H. Clark CHC@charlesclarklaw.com Law Offices of Charles H. Clark P. O. Box 98 Tyler, Texas 75710
Bruce A. Smith Ward & Smith P. O. Box 1231 Longview, Texas 75606-1231
Clay Wilder cwilder@suddenlinkmail.com Wilder & Wilder, P.C. 200 North Main Street P. O. Box 1108 Henderson, Texas 75653-1108
iii TABLE OF CONTENTS
Identity of Parties and Counsel .............................................................................. ii
Table of Contentents ............................................................................................... iv
Index of Authorities ............................................................................................. vii
Statement Regarding Oral Argument......................................................................xii
Reply Issues ............................................................................................................xii
Statement of Facts ...................................................................................................1
Summary of the Argument .................................................................................... 13
Argument and Authorities ..................................................................................... 19
Reply to Issue 1 .......................................................................................... 19
The Court had jurisdiction and “prudential power” to order the mineral interests sold and the proceeds partitioned as requested by both sides.
Reply to Issue 2 .......................................................................................... 29
Tate and Miken Oil properly pled an action in partition of these mineral interests under Rule 756 and the court was correct to deny Long and Woodbine’s special exceptions on this ground.
Reply to Issues 3, 4 and 5 ..................................................................... 32, 33
There was sufficient evidence to support the trial court’s order.
Reply to Issue 3
The court correctly ordered the mineral interests jointly owned by the parties sold as requested by both sides. It was undisputed that Tate and Miken owned an interest and the order correctly reflected that it was partitioning all of the property jointly owned by the parties.
iv Reply to Issue 4
There was sufficient evidence to support the court’s order as to Tate and Miken.
Reply to Issue 5
Long and Woodbine pled and stipulated that the mineral interests were not subject to partition in kind and agreed that they should be sold.
Reply to Issue 6 .......................................................................................... 37
The court properly appointed a qualified receiver to handle the sale of the jointly owned mineral interests.
Reply to Issues 7 and 8 ............................................................................... 40
Reply to Issue 7
The court proceeded properly and the parties stipulated that no issues would be waived pending the second phase of the partition proceeding.
Reply to Issue 8
The court entered its order after conducting a proper hearing with all parties and after the parties agreed on the record that the interests be sold and the money deposited into the registry of the court; further, the court and the parties agreed on the record that Long and Woodbine were not waiving any claims for contribution.
Reply to Issue 9 ......................................................................................... 46
The court conducted a proper hearing with all parties before entering the order
v Conclusion and Prayer for Relief .................................................................... 47, 48
Certificate of Compliance ..................................................................................... 48
Certificate of Service....... .......................................................................................49
Appendix
App. 1 Defendant Long’s Original Counterclaim and Plea in Intervention by Woodbine Production Company dated September 9, 2013
App 2 Defendant Larry Long’s Second Amended Original Answer dated October 9, 2013
vi INDEX OF AUTHORITIES
Cases
Aldous v. Bruss, 405 S.W.3d 847 (Tex. App.—Houston [14th Dist.] 2013, no pet.) ............................15, 29, 30
Azios v. Slot, 653 S.W.2d 111 (Tex.App.-Austin 1983, no pet.)...................................................................3
Baylor Univ. v. Sonnichsen, 221 S.W.3d 632 (Tex. 2007).........................................................................29
BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789 (Tex. 2002) ..........................................................................24
Brooks v. Northglen Ass’n, 141 S.W.3d 158 (Tex. 2004).............................................................14, 22, 23
Carper v. Halamicek, 610 S.W.2d 556 (Tex. Civ. App.--Tyler 1980, writ ref'd n.r.e.)..................................23, 24, 27
City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005).........................................................................33
Clanton v. Clark, 639 S.W.2d 929 (Tex. 1982)...................................................................17, 32
Clegg v. Clark, 405 S.W.2d 697 (Tex. Civ. App. -- Waco 1966, writ ref’d) ...................................................27
Cooper v. Texas Gulf Indus., Inc., 513 S.W.2d 200 (Tex. 1974).........................................................................27
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ACCEPTED 12-14-250-cv TWELFTH COURT OF APPEALS TYLER, TEXAS 1/13/2015 1:47:20 PM CATHY LUSK CLERK
CAUSE NO. 12-14-00250-CV
IN THE FILED IN 12th COURT OF APPEALS COURT OF APPEALS TYLER, TEXAS TWELFTH COURT OF APPEALS 1/13/2015 1:47:20 PM TYLER, TEXAS CATHY S. LUSK Clerk
LARRY LONG AND WOODBINE PRODUCTION CORPORATION, Appellants
V.
MIKEN OIL, INC. and MIKE TATE, Appellees ______________________________________________________________
On Appeal from the th 4 Judicial District Court of Rusk County, Texas The Honorable J. Clay Gossett, Presiding Judge ______________________________________________________________
BRIEF OF APPELLEES MIKEN OIL, INC. and MIKE TATE
Deborah J. Race Texas Bar No. 16448700 IRELAND, CARROLL & KELLEY, P.C. 6101 S. Broadway, Suite 500 Tyler, Texas 75703 Drace@icklaw.com Tel: (903) 561-1600 Fax: (903) 581-1071
ATTORNEY FOR APPELLEES
ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL
Pursuant to Tex. R. App. P. 52.3(a), the following is a complete list of all parties and the names and addresses of all counsel.
Appellants: Larry T. Long Woodbine Production Corporation
Appellate Counsel: F. Franklin Honea frank@honealaw.com The Law Offices of F. Franklin Honea 5949 Sherry Lane, Suite 1700 Dallas, Texas 75225
Trial Counsel: Ron Adkison ron@adkisonlawfirm.com The Adkison Law Firm 300 W. Main Street Henderson, Texas 75652-3109
Brent Bull Bull & Barrett, LLP Energy Centre 1127 Judson Road, Suite 120 Longview, Texas 75601
Appellees: Miken Oil, Inc. Mike Tate
Appellate Counsel: Deborah J. Race Drace@icklaw.com Ireland, Carroll & Kelley, P.C. 6101 S. Broadway, Suite 500 Tyler, Texas 75703
ii Trial Counsel: Charles H. Clark CHC@charlesclarklaw.com Law Offices of Charles H. Clark P. O. Box 98 Tyler, Texas 75710
Bruce A. Smith Ward & Smith P. O. Box 1231 Longview, Texas 75606-1231
Clay Wilder cwilder@suddenlinkmail.com Wilder & Wilder, P.C. 200 North Main Street P. O. Box 1108 Henderson, Texas 75653-1108
iii TABLE OF CONTENTS
Identity of Parties and Counsel .............................................................................. ii
Table of Contentents ............................................................................................... iv
Index of Authorities ............................................................................................. vii
Statement Regarding Oral Argument......................................................................xii
Reply Issues ............................................................................................................xii
Statement of Facts ...................................................................................................1
Summary of the Argument .................................................................................... 13
Argument and Authorities ..................................................................................... 19
Reply to Issue 1 .......................................................................................... 19
The Court had jurisdiction and “prudential power” to order the mineral interests sold and the proceeds partitioned as requested by both sides.
Reply to Issue 2 .......................................................................................... 29
Tate and Miken Oil properly pled an action in partition of these mineral interests under Rule 756 and the court was correct to deny Long and Woodbine’s special exceptions on this ground.
Reply to Issues 3, 4 and 5 ..................................................................... 32, 33
There was sufficient evidence to support the trial court’s order.
Reply to Issue 3
The court correctly ordered the mineral interests jointly owned by the parties sold as requested by both sides. It was undisputed that Tate and Miken owned an interest and the order correctly reflected that it was partitioning all of the property jointly owned by the parties.
iv Reply to Issue 4
There was sufficient evidence to support the court’s order as to Tate and Miken.
Reply to Issue 5
Long and Woodbine pled and stipulated that the mineral interests were not subject to partition in kind and agreed that they should be sold.
Reply to Issue 6 .......................................................................................... 37
The court properly appointed a qualified receiver to handle the sale of the jointly owned mineral interests.
Reply to Issues 7 and 8 ............................................................................... 40
Reply to Issue 7
The court proceeded properly and the parties stipulated that no issues would be waived pending the second phase of the partition proceeding.
Reply to Issue 8
The court entered its order after conducting a proper hearing with all parties and after the parties agreed on the record that the interests be sold and the money deposited into the registry of the court; further, the court and the parties agreed on the record that Long and Woodbine were not waiving any claims for contribution.
Reply to Issue 9 ......................................................................................... 46
The court conducted a proper hearing with all parties before entering the order
v Conclusion and Prayer for Relief .................................................................... 47, 48
Certificate of Compliance ..................................................................................... 48
Certificate of Service....... .......................................................................................49
Appendix
App. 1 Defendant Long’s Original Counterclaim and Plea in Intervention by Woodbine Production Company dated September 9, 2013
App 2 Defendant Larry Long’s Second Amended Original Answer dated October 9, 2013
vi INDEX OF AUTHORITIES
Cases
Aldous v. Bruss, 405 S.W.3d 847 (Tex. App.—Houston [14th Dist.] 2013, no pet.) ............................15, 29, 30
Azios v. Slot, 653 S.W.2d 111 (Tex.App.-Austin 1983, no pet.)...................................................................3
Baylor Univ. v. Sonnichsen, 221 S.W.3d 632 (Tex. 2007).........................................................................29
BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789 (Tex. 2002) ..........................................................................24
Brooks v. Northglen Ass’n, 141 S.W.3d 158 (Tex. 2004).............................................................14, 22, 23
Carper v. Halamicek, 610 S.W.2d 556 (Tex. Civ. App.--Tyler 1980, writ ref'd n.r.e.)..................................23, 24, 27
City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005).........................................................................33
Clanton v. Clark, 639 S.W.2d 929 (Tex. 1982)...................................................................17, 32
Clegg v. Clark, 405 S.W.2d 697 (Tex. Civ. App. -- Waco 1966, writ ref’d) ...................................................27
Cooper v. Texas Gulf Indus., Inc., 513 S.W.2d 200 (Tex. 1974).........................................................................27
DART v. Edwards, 171 S.W.3d 584 (Tex. App.--Dallas 2005, pet. denied) ..........................................................30
vii Davis v. Davis, 2013 Tex.App. LEXIS 5525 (Tex.App.—Dallas 2013, no pet.)...........................................................17, 39
Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex. 1985)................................................13, 20, 31
Dukes v. Migura, 758 S.W.2d 831, (Tex.App.—Corpus Christi 1988), rev’d on other grounds, 770 S.W.2d 568 (Tex. 1989).........................................................................25
Ellis v. First City Nat’l Bank, 864 S.W.2d 555 (Tex.App.—Tyler 1993, no pet.)...................................................................42
Friesenhahn v. Ryan, 960 S.W.2d 656 (Tex. 1998).........................................................................29
Gilmer Indep. Sch. Dist. v. Dorfman, 156 S.W.3d 586 (Tex. App.- Tyler 2003, no pet.)...................................................................25
Green v. Doakes, 593 S.W.2d 762 (Tex.Civ.App. – Houston [1st Dist.] 1979, no writ)..........................16, 37, 39
Guerro v. Salinas, 2006 Tex. App. LEXIS 8562, Tex. App. – Corpus Christi 2006, no pet.)........................30, 31
Hanrick v. Gurley, 93 Tex. 458, 54 S.W. 347 (1899).......................................................................................41
Hoover v. Materi, 515 S.W.2d 406 (Tex.Civ.App. – El Paso 1974, writ ref’d n.r.e.) ......................................................................................44, 45
viii Hudson v. Sweatt, 2014 Tex. App. LEXIS 12660 (Tex.App.—El Paso Nov. 21, 2014)................................14, 22
In re Davis, 418 S.W.3d 684 (Tex.App.—Texarkana 2012, orig. pro.).......................................................39
IKB Industries v. Pro-Line Corp., 938 S.W.2d 440 (Tex. 1997).........................................................................34
James v. Underwood, 438 S.W.3d 704 (Tex.App.—Houston [1st Dist.] 2014, no pet.)..............................................30 Johnson v. Fourth Court of Appeals, 700 S.W.2d 916 (Tex. 1985)...................................................................13, 20
K.C. Roofing Co., Inc. v. Abundis, 940 S.W.2d 375 (Tex.App -- San Antonio 1997, writ denied) ..................................................................................................34
Kubena v. Hatch, 144 Tex. 627, 193 S.W.2d 175 (1946) ........................................................26
Kutch v. Del Mar College, 831 S.W.2d 506 (Tex. App.--Corpus Christi 1992, no writ).........................................................................................................30
Love v. Woerndell, 737 S.W.2d 50 (Tex. App. – San Antonio 1987, writ denied)......................25
Maritime Overseas Corp. v. Ellis, 971 S.W.2d 402 (Tex. 1998) ........................................................................33
Maverick v. Burney, 88 Tex. 560, 32 S.W. 512 (1895) .................................................................22
ix Mercedes-Benz Credit Corp. v. Rhyne, 925 S.W.2d 664 (Tex. 1996).......................................................................46
Mulvey v. Mobil Producing Tex. & N.M., Inc., 147 S.W.3d 594 (Tex. App.--Corpus Christi 2004, pet. denied) ...................................................................................................30
Mustang Drilling, Inc. v. Cobb, 815 S.W.2d 774 (Tex.App.—Texarkana 1991, writ denied) ..................................................................................................26
New v. First Nat’l Bank, 476 S.W.2d 121 (Tex.Civ.App. – El Paso 1972, no writ) .........................................................................................................37
Ortiz v. Jones, 917 S.W.2d 770 (Tex. 1996).........................................................................33
Puntarelli v. Peterson, 405 S.W.3d 131 (Tex. App. – Houston [1st Dist.] 2013, no pet.) ..........................19, 20, 46, 47
Shepherd v. Ledford, 962 S.W.2d 28 (Tex. 1988) ..........................................................................36
State v.Blair, 629 S.W.2d 148 (Tex. App. -- Dallas, aff'd, 640 S.W.2d 867 (Tex.1982))....................................................................................................26
Texas Oil & Gas Corp. v. Ostrom, 638 S.W.2d 231(Tex.App.—Tyler 1982, writ ref’d n.r.e.).......................................................................................27, 28
Veal v. Thomason, 138 Tex. 341, 159 S.W.2d 472 (1942)....................................................27, 28
x Ward v. Hinkle, 117 Tex. 566, 8 S.W.2d 641 (1928) ...............................................21, 22, 27
Wyatt v. Shaw Plumbing Co., 760 S.W.2d 245 (Tex. 1988) ..................................................................13, 20
Rules
Tex. R. Civ. P. 39 .........................................................................................8, 20, 27
TEX. R. CIV. P. 91 ...................................................................................................29
Tex. R. Civ. P. 299a...........................................................................................16, 34
Tex. R. Civ. P. 756 ............................................................................................iv, 29
Tex. R. Civ. P. 757 .......................................................................................9, 20, 21
Tex. R. Civ. P. 770 .....................................................................................17, 38, 39
Tex. R. Civ. P. 760 ...........................................................................................18, 40
Tex. R. App. P. 33.1(a)(1) ................................................................................17, 39
Codes
Texas Civil Practice & Remedies Code §3.23 (1981) ...........................................27
Texas Civil Practice & Remedies Code §§ 64.022 and 64.023 .............................39
Other
68 C.J.S., Partition, § 144b, p. 239 .........................................................................45
Texas Constitution, Article I, Sec. 15 and Article V, Sec. 10 ..............................2, 3
xi STATEMENT REGARDING ORAL ARGUMENT
Tate and Miken request oral argument in this appeal. The record is lengthy
and they believe oral argument and the ability to question counsel will assist the
Court in deciding the issues raised in this appeal.
REPLY ISSUES
Reply to Issue 1 .......................................................................................... 19
The Court had jurisdiction and “prudential power” to order the mineral interests sold and the proceeds partitioned as requested by both sides.
Reply to Issue 2 .......................................................................................... 29
Tate and Miken Oil properly pled an action in partition of these mineral interests under Rule 756 and the court was correct to deny Long and Woodbine’s special exceptions on this ground.
Reply to Issues 3, 4 and 5 ..................................................................... 32, 33
There was sufficient evidence to support the trial court’s order.
The court correctly ordered the mineral interests jointly owned by the parties sold as requested by both sides. It was undisputed that Tate and Miken owned an interest and the order correctly reflected that it was partitioning all of the property jointly owned by the parties.
Reply to Issue 4
There was sufficient evidence to support the court’s order as to Tate and Miken.
xii Reply to Issue 5
Long and Woodbine pled and stipulated that the mineral interests were not subject to partition in kind and agreed that they should be sold.
Reply to Issue 6 .......................................................................................... 37
The court properly appointed a qualified receiver to handle the sale of the jointly owned mineral interests.
Reply to Issues 7 and 8 ............................................................................... 40
The court proceeded properly and the parties stipulated that no issues would be waived pending the second phase of the partition proceedings.
The court entered its order after conducting a proper hearing with all parties and after the parties agreed on the record that the interests be sold and the money deposited into the registry of the court; further, the court and the parties agreed on the record that Long and Woodbine were not waiving any claims for contribution.
Reply to Issue 9 ......................................................................................... 46
The court conducted a proper hearing with all parties before entering the order.
xiii STATEMENT OF FACTS
The most critical aspect of the procedural and factual history of this case is
that the parties agreed to the procedure implemented by the trial court. (RR I p.11,
ll 16-25; p. 12 1-5; p. 16, ll 18-25; p. 17 ll 1-12; p. 18 ll 24-25; p. 19 ll 1-8; p. 20 ll
1-8; RR II p. 13 ll 8-14; p. 14 ll 17-20; p. 15 ll 1-3, 20-25; p. 16 ll 1-25; p. 17 ll
20-24; p. 22 ll 5-21; p. 23 ll 11-12). Tate and Miken1 filed suit in Gregg County
against Larry Long seeking, among other relief, a partition of certain oil and gas
properties, including the Young and Thrash leases located in Rusk County and
jointly owned by the parties. (CR I 7). The defendant filed a motion to transfer
venue and the Gregg County court agreed that venue was mandatory in Rusk
County as to all “claims pertaining to the Young and Thrash leases,” and ordered
those matters transferred. (C.R.I 25). On September 4, 2013, Tate filed a request
for hearing asking the Court to determine whether the Thrash and Young leases
were susceptible to partition in kind. (C.R. I 26).
Long filed a counterclaim and Woodbine Production Company filed a plea
in intervention on September 9, 2014. 2 (CR I 28). Therein, Long and Woodbine
expressly admitted that “This court has jurisdiction and venue over the subject
matter and the persons named herein.” (CR I 28). Apparently Woodbine had filed
claims against Tate, which the Rusk County court had transferred back to Gregg
1 Tate and Miken will be referred to individually as necessary or collectively as Tate. 2 Long and Woodbine will be referred to individually as necessary or collectively as Long. 1 County, but Woodbine explained that it was also filing the claims in Rusk County
“inasmuch as the assertion of its claims must be made in this partition action.” (CR
I 30). The pleading continued “The original filing of this action in Gregg County
preceded the filing of Woodbine’s original action which the Court transferred.”
(CR I 30). The pleading explained that Tate and Long had acquired their interests
in 2000 and that Woodbine was the operator of the Young and Thrash leases. (CR
I 30-31). The pleading sought a declaration of cotenancy, reimbursement and a
creation of an equitable lien. (CR I 32-33).
On that same day, Long and Woodbine also filed a response to Tate’s
request for a hearing and a plea in abatement. (CR I 114). Therein, they pled that
the court had to first decide whether the property was susceptible to partition in
kind. (CR I 115). They then stated “There is significant dispute whether either of
the two oil and gas leases are partitionable in kind.” (CR I 116). They contended
that “While jointly owned lands which are unexplored and undeveloped for
minerals are usually partitionable in kind because it is presumed to have an equal
distribution of potential minerals in every part of the property, known mineral
interests are usually not partitionable in kind.” (CR I 116). They requested
discovery to determine whether the properties could be partitioned in kind. (CR I
117). They also urged that: “Finally, a partition action is one in which the trial by
jury must be recognized. Texas Constitution, Article I, Sec. 15 and Article V, Sec.
2 10 apply to partition actions. In Azios v. Slot, 653 S.W.2d 111 (Tex.App.-Austin
1983, no pet.), that court held that the factual dispute regarding whether jointly
owned land was or was not partitionable in kind should have been tried before a
jury.” (CR I 119).
Long and Woodbine also argued that by their suit Tate and Miken sought to
partition “only the interests of Plaintiffs and Defendant, leaving out the other
owners of the leaseholds.” (CR I 119). They asked that others owning an interest in
the minerals be joined as well. (CR I 120). Tate filed a response to Long and
Woodbine’s counterclaim and also a response to the plea in intervention. (CR I
125, 127). Tate explained that “Woodbine now attempts to file an Intervention in
this lawsuit, which is essentially the same lawsuit it filed under Cause No. 2013-
102.” (CR I 127). Tate urged that “Every issue raised by Woodbine in its Plea of
Intervention is now before the Court in Gregg County, Texas. Woodbine does not
own any interest in the real property which is the subject of this lawsuit. Its
presence before this Court is not required for this Court to determine the issues
presented to it in this lawsuit which involves the partition of real estate located in
Rusk County, Texas.” Id. Thereafter, the court entered an order setting the
hearing. (CR I 130).
Next Long and Woodbine filed a motion asking the court to reset the hearing
on the property’s susceptibility to partition in kind to allow the court to consider
3 Long and Woodbine’s plea in abatement and the need for additional parties and to
permit discovery on this issue. (CR I 131). Therein, they urged that the Court also
needed to consider Woodbine’s argument that Tate was indebted to it and that the
partition would need to address that issue. (CR I 136). They argued that Tate had
not pled a proper partition and needed to replead. (CR I 137). Long and
Woodbine then filed Amended Special Exceptions arguing that plaintiffs were
trying to partition only a part of an undivided interest in oil and gas, namely 7/8 th
of the working interest. (CR I 143). Woodbine also filed a response to Tate’s
motion to strike its intervention, admitting that its Gregg County suit was identical,
but arguing that it was also a necessary party to the partition action. (CR I 164). It
urged that its claim for contribution had to be determined in the partition suit. (CR
I 173, 181).
On that same day, Long filed an amended answer. (CR I 186). Therein,
Long asserted that “Although addressed separately in Defendant's Motion to Abate,
Plea in Abatement and Supplemental Plea in Abatement, the lack of necessary
parties in this case is a jurisdictional issue because the non-party, cotenant
leasehold interest owners have an immediate right of possession in the entire
undivided leasehold estate.” (CR I 187). Long also argued that the interests were
not susceptible to being partitioned in kind. (CR I 188). Long represented, “As
there is no reasonable way to determine how to partition in kind the minerals at a
4 reasonable cost, the lands should be partitioned by sale, rather than in kind, and
the proceeds distributed according to each party's interest.” (CR I 188, emphasis
added). Long also complained that Tate had failed to join the owners of the
outstanding 1/8th working interest. (CR I 189). Long then filed a Supplemental
Plea in Abatement and Supporting Brief. (CR I 193).
On October 17, 2013, the court held a hearing on Plaintiff's Motion to
Transfer Venue or Motion to Strike, Plaintiff's Motion to Strike and Intervention,
and Long and Woodbine’s Special Exception and Plea in Abatement. (RR 1 3 ll
12-16). Tate’s counsel began with an explanation of the history of the property and
noted that in their answer, the defendants had argued that the land could not be
partitioned in kind, but should instead be sold. (RR 1 5). He explained that there
was no dispute that the parties together owned 7/8 th of the working interest. Id. He
next pointed out that Long had advised that he would want a jury trial if the
interests were to be partitioned in kind. (RR 1 4 ll 4-16). He then stated, “But
there's a way to avoid that, and we're going to suggest it to the Court, because the
defendants have already suggested it; they pled it twice. They want to sell the
properties and divide the proceeds, and we've – Clay Wilder and I have talked with
our client, and we've gone over this matter, and we're totally in agreement with
that.” (RR 1 6 ll 17-22). He explained that this would eliminate the need for the
jury trial, expedite matters and be an efficient and economical way to resolve the
5 case. (RR 1 7 ll 1-6). Counsel then stipulated that the property should be sold.
(RR 1 7 ll 9-10). Counsel explained that Tate had already deposited $125,000 into
the registry of the court for any money he owed Long. (RR 1 8 ll 6-9).
The Court then asked if the parties were in agreement that the property was
not subject to being partitioned in kind. (RR 1 11 ll 16-17). Long’s counsel
responded that “We agree that that is not susceptible to being partitioned in kind.”
Id., ll 18-19. However he expressed concern about the timing. Id., ll 21-22. The
court then confirmed that while he understood those concerns, “the parties are
therefore in agreement that at some point in time that the property will need to be
sold; therefore, it just appears to me then the questions before the Court would be
who owns – number one, if all parties are necessarily joined in the lawsuit, and
then the next step would be who owns what and who is owed what.” Id., ll 23-25;
RR 1 12 ll 1-5.
The court then discussed the joinder of parties. The court asked if it had to
make that determination before it ordered the sale. (RR 1 15, ll 24-25). Long
replied with concerns about liens and potential claims. (RR 1 16-17). And Tate
represented he agreed. (RR 1 17 ll 6-7). Long and Woodbine’s counsel then
stated, “I think we have reserved Woodbine’s position by filing.” (RR 1 17 ll 9-
10). To which the court replied, “Right, And the Court would so order that you
have.” Id., ll 11-12. The court also stated, “Well now, that’s why I’m agreeing on
6 what the agreement is. I mean, I think – and y’all may not be in agreement on this,
so I think that the Court needs to make a determination of whether or not there
needs to be any additional parties added to the lawsuit, And then number two, then
the Court could order the property sold, and the Court then determines – and I may
have this out of order – then determines any issues of offsets, liens, ownership,
contributions, who owes – who is owed what money.” (RR 1 18 ll 24-25; 19 ll 1-
7). To which Long and Woodbine’s counsel replied, “Who gets what.” (RR 19 l
8).
The Court next advised that its dispute at that time was “the party issue, and
the additional other lawsuits.” (RR 1 ll 23-24). The Court then stated, “And I
would be at this point in time to be inclined, and I would think ya’ll would
hopefully want to get all of that resolved before this Court, if possible.” Id., ll25;
RR 1 20 ll 1-2. Long and Woodbine’s counsel replied, “Yes, sir.” (RR 1 20, ll 3).
The Court then stated, “If possible. Okay. Everybody is shaking their head yes for
the record.” Id., ll 4-5. The court then summarized, “All right. Let’s go through
this. The parties, that’s the first dominant issue, to make sure we have all parties
before the Court with affidavits filed before the Court under oath with any interest
either party might have, know of, et cetera. The Court will rule upon necessary
parties at that time.” (RR 1 21, ll 6-11). The Court concluded, “All right. So we
determine the parties, make sure we have all parties before the Court. At that time,
7 subject to whatever interest they might have or whatever arguments they might
have, order the property sold, and then determine ownership of the property.” (RR
1 22 ll 10-14). The Court then granted the abatement in order to determine the
party question. (RR 1 24 ll 3-4). Counsel for Long and Woodbine confirmed this
was the order of the Court. Id., ll 5-7. The Court concluded, “Yes. That was the
effect of the order. But that we have these other issues resolved before the – for
the Court’s determinations. All right. Thank you, gentlemen.” (Id., ll 7-10).
Subsequent to this hearing Tate filed a brief supporting the position that the
joinder of additional owners was not necessary. (CR II 213). Tate explained that
Bonanza Production Company had assigned Tate and Long all of its 7/8 th interest
in the Thrash and Young leases in 2000. (CR II 214). Tate noted that the other
1/8th working interest was owned by other entities who were not a party to the suit.
Id. Tate explained that in 1993, Granite Oil had sold and assigned all of its interest,
the 7/8th working interest, in these leases to Bonanza. Id. Tate noted that the
outstanding 1/8th interest was not involved in either the assignment to or from
Bonanza. Id. Tate then presented argument and authorities supporting the position
that the joinder of the outstanding 1/8th interest was not necessary for the sale of
Tate and Long’s 7/8th, including that joinder was not necessary under Rule 39. (CR
II 216). Tate presented a summary of its argument in the brief. (CR II 224-225).
8 Tate also attached an affidavit of a landman, and various other supporting
documents. (CR II 227-85).
Long filed a reply brief in which he urged that joinder was mandatory under
Rule 757 governing partition. Tex. R. Civ. P. 757. (CR II 298). Long disagreed
with Tate that because the sale only involved the 7/8 th owned jointly by Tate and
Long, it was not necessary to join the owners of the other 1/8 th. (CR II 302). Long
also filed notices of liens and other burdens it claimed affected the Young and
Thrash leases. (CR Supp I, II and III).
The Court issued a letter ruling on December 18, 2013, denying Long’s plea
in abatement and a corrected letter ruling on January 8, 2014. (CR II 361-62). The
Court then issued an order asking the parties to confer and see if they could reach
an agreement regarding its order. (CR II 363).
The record next contains Tate’s motion for protective order. (CR III, IV &
V). Therein, Tate complained about the massive volume of discovery it had
received from Woodbine. (CR III 371). Tate explained that the only thing pending
before the Court was the sale of the Thrash and Young leases. Id. Tate also wrote:
“Defendants have agreed in open court that the properties could not be partitioned
in kind, and both Plaintiffs and Defendants and Intervenor have agreed in
statements to this Court that the properties should be partitioned by sale.” Tate
9 explained that most of the discovery it had received was identical to discovery
served in the Gregg County suit. (CR III 372).
Woodbine responded that the court first needed to determine the burdens and
liens against either party’s respective interest. (CR VI 1063-64). Woodbine also
filed a Motion to Compel. (CR VI 1101). The court set the matter for hearing on
May 1, 2014. (CR VI 1114). The parties and counsel appeared at the hearing, and
agreed to take up both the protective order and motion to compel. (RR 2 3 ll 15-
16). The parties ended up agreeing to be bound by the same discovery in both suits.
(RR 2 9 ll 7-14, 24-25; 11 ll 2-9).
Next, the parties again addressed the procedure to be followed in the case.
Tate represented that the parties had agreed that their interests should be sold and
that the court then place the funds into the registry of the court while the question
of any claims was sorted out. (RR 2 13 ll 8-19). Long and Woodbine expressed
concerns that they not waive any rights, stating “if we could have an agreement
that’s somewhat procedurally and substantively binding by agreeing to that method
to do it that we’re no waiving our claim for contribution. Because the cases say –
otherwise the cases are going to hold that we do, so that – I mean, some way
procedurally we’ve got to get past that, or we’re going to have waived or we’re at
risk of having waived our claim for contribution.” (RR 2 14 ll 17-24). Tate
replied that he didn’t think there was dispute; that the interests needed to be sold,
10 the funds deposited with the court and the court then determine if there was any
claim of contribution that would affect the distribution of the funds. (RR 2 15 1-
23). Tate concluded, “So they’re not going to be prejudiced or waive anything,
because all of these claims are pending over here. And you’re not – and the Court
is not going to distribute any funds until the Court is satisfied that all of these
issues have been resolved and any claim that one side wants to make against the
other is not affecting how this is to be – how this money is to be distributed.” (RR
2 16 ll 2-8).
Long responded that “the stipulation that we made is clear ….” (R 2 16 ll
19-20). Long repeated the concern that there was authority that the court must
make the determination as to claims at the first hearing and it was concerned that it
not waive that right. Long stated: “So the language of the Court makes it clear that
that’s not just a straight partition action where you’re going to parcel it out and sell
it, but it goes to the question also of contribution claims, and the Court assumes
jurisdiction over it under our agreement.” (R 2 17, ll 7-12).
The court agreed, stating, “All right. So then the order of the Court would
be that you’re not waiving any rights for contributions under the statute because
you’re allowing the case – the property to be sold first without making that
determination prior to the sale of the property.” (RR 2 17 ll 20-14). Long repeated
concerns about waiver, advising the court it did not want to “step into this trap.”
11 (RR 2 19 ll 3-10). Tate assured the court that it had stipulated they were not
waiving anything. (RR 2 22 ll 16-21). Tate also stated, “But here’s the thing about
continuing – and first off, you know, what counsel over here needs to tell the Court
is why they changed their minds.” (RR 2 22 ll 19-21). To which Long responded,
“We haven’t.” (RR 2 22 l 22). Long continued, “Well wait a minute. I think we
agreed to sell the lease and split the money.” (RR 2 23 ll 11-12). Long expressed
concerns about the timing and waiver. Tate replied, “I just want to make sure our
position is clear. As far as we’re arguing the timing and the urging that the leases
be sold sooner rather than later, we’re not doing so to try to trick or to lead counsel
into some trap. If there’s evidence of that, Mr. Clark and I both have said on the
record today that we’ve stipulated that whatever claims they have of any kind or
character, we will say that they can make those claims against these funds. We are
not trying to say or argue that they would have waived anything, and we’re willing
to say that and we do say that at this time.” (RR 2 27 ll 2-12).
Finally, Long expressed concerns about whether this argument was
jurisdictional, stating “The other thing that's bothering me is if -- something
jurisdictional can't be waived, so the question is, is that issue jurisdictional or not.”
(CR 2 28 ll 6-8). The court instructed the parties to submit briefs on that issue
within a week and promised to take a look at those. (CR 2 28 ll 13-14). No such
briefs are contained in the Clerk’s Record.
12 On July 31, 2014, the court entered an order finding the property not
susceptible to partition in kind, appointing a receiver and ordering the property
sold. The order expressly stated: “It Is Therefore Ordered that the above-
described property be sold and that the proceeds or [sic] such sale be distributed
among the above-listed co-owners in accordance with further orders of this court.”
(CR VI 1116). No findings of fact were requested or filed. Long and Woodbine
then filed a Notice of Appeal. (CR VI 1127).
SUMMARY OF THE ARGUMENT
In the first issue, Long argues that the court’s failure to join the owners of
the other 1/8th interest was jurisdictional or in the alternative that the court lacked
prudential power to proceed. (Long brief at 2). As a result, Long claims the court
erred in denying Long’s plea in abatement. (Long brief at 1, 11, 13). An appellate
court reviews a ruling on a plea in abatement under an abuse of discretion standard.
Wyatt v. Shaw Plumbing Co., 760 S.W.2d 245, 248 (Tex. 1988). A court abuses its
discretion when it acts so arbitrarily or unreasonably as to amount to a clear and
prejudicial error of law. Johnson v. Fourth Court of Appeals, 700 S.W.2d 916, 917
(Tex. 1985). A court acts unreasonably when it acts without reference to any
guiding rules of principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d
238, 241-42 (Tex. 1995).
13 With respect to Long’s jurisdictional argument, the parties agreed the court
had subject matter jurisdiction and it did. (CR I 28; RR 2 17 ll 7-12). Even had the
court needed to join additional parties, which it did not, the failure to join all
necessary parties to a partition does not deprive the court of subject matter
jurisdiction. See Hudson v. Sweatt, 2014 Tex.App. LEXIS 12660 (Tex.App. – El
Paso, Nov. 21, 2014). Instead, under Rule 39, the trial court is to decide whether it
has the authority to proceed and if it does proceed, the judgment is final as to the
parties before the court. See Brooks v. Northglen Ass’n, 141 S.W.3d 158, 192
(Tex. 2004).
Here, it was not necessary to join the owners of the other 1/8th interest.
Their interests would not be affected by this suit. Long contends that Rule 757
required the joinder, but that rule requires that the clerk issue citation for each joint
owner or claimant. Long and Tate were the only joint owners or claimants of the
7/8th interest to be partitioned. No one else had an interest in the property sought to
partitioned and no one else would be affected by the decision.
Long acknowledges that under Brooks, the trial court’s decision might not
be jurisdictional and argues that in the alternative, this court review the complaint
under a “prudential power” standard of review. (Long brief at 20). As seen above,
this issue would be reviewed under an abuse of discretion standard. The trial court
did not abuse its discretion in proceeding and acted prudently in doing so. The
14 court considered all the arguments of the parties and received briefing on the issue.
(CR II 213, 296). And even more importantly, it proceeded according to the
agreements and stipulations of the parties. . (RR I p.11, ll 16-25; p. 12 1-5; p. 16, ll
18-25; p. 17 ll 1-12; p. 18 ll 24-25; p. 19 ll 1-8; p. 20 ll 1-8; RR II p. 13 ll 8-14; p.
14 ll 17-20; p. 15 ll 1-3, 20-25; p. 16 ll 1-25; p. 17 ll 20-24; p. 22 ll 5-21; p. 23 ll
11-12).
In Issue 2, Long complains that the court erred in denying Long’s Special
Exceptions. (Long brief at 2, 11, 33). As with Issue 1, this issue is also reviewed
for an abuse of discretion. See Aldous v. Bruss, 405 S.W.3d 847, 857 (Tex.App. –
Houston [14th Dist.] 2013, no pet.). While the court held a hearing on the special
exceptions, there is no ruling in the record. Long argues that the ruling may be
implied, but the record does not support that. As the conclusion of the hearing the
court set out the procedure it would follow according to the parties’
representations. (RR 1 21 ll 6-11). The court held a subsequent hearing on several
matters and again set out the procedure to be followed. (RR 2 23-25). It is
doubtful that Long preserved this complaint, but even it was preserved, the
complaint is without merit. The court did not abuse its discretion.
By the next three issues, Long attacks the sufficiency of the evidence to
support the ownership by the parties (Issue 3), the entry of the order (Issue 4) and
the decision that the interests were not susceptible to partition in kind (Issue 5).
15 (Long brief at 3-4, 12, 35). Long begins by attacking the trial courts “findings and
conclusions.” (Long brief at 35). The problem with this argument is no findings
were requested or filed. Recitations in the judgment are not findings. Tex R.Civ.P.
299a.
Furthermore, even if there were such findings, Long’s arguments have no
merit. There was more than sufficient evidence, including the stipulations of the
parties, to support the trial court’s order. There was never any dispute as to the
ownership of the 7/8th interest (CR I 28-39; RR I 10 ll 18-19; Long brief at 37).
And while Long argues that the court’s order ordered the entire 8/8th interest sold,
it did not. It provided only that the property owned jointly by Tate and Long be
sold.
Long complains about the fact the order found the property not susceptible
to partition in kind. (Long brief at 37). From the very beginning Long has argued
that the property was not susceptible to being partitioned in kind and would instead
need to be sold. (CR I 116, 188; RR 1 11 ll 16 – 20). Long admits to this
stipulation, but argues it wasn’t valid without the owners of the outstanding 1/8 th
interest. (Long brief at 38). Long and Tate’s stipulation would not only be valid as
between them, but binding.
In Issue 6, Long complains about the appointment of a receiver to handle the
sale. This too is reviewed for an abuse of discretion. See Green v. Doakes, 593
16 S.W.2d 762, 764 (Tex.Civ.App. – Houston [1st Dist.] 1979, no writ). The parties
agreed to the sale of the minerals and the appointment of a receiver is provided for
under Rule 770. Tex.R.Civ.P. 770. As the court in Green correctly noted, receivers
are appointed in practically every partition case pursuant to Rule 770. Id.
Long complains that the order did not require the receiver to take an oath or
post a bond. (Long brief at 40). The record does not reflect that Long or
Woodbine ever made this complaint to the court, so it does not appear this
complaint was preserved under Rule 33.1(a)(1). Tex. R. App. P. 33.1(a)(1).
Additionally, even if a silent record would be sufficient to show the receiver was
not sworn, there is also nothing in this record to show that the receiver has
assumed his duties. See Davis v. Davis, 2013 Tex.App. LEXIS 5525 (Tex. App. –
Dallas 2013, no pet.).
In the 7th and 8th issues, Long complains about the court’s decision to defer
its ruling on the interests and outstanding claims until after the sale. (Long brief at
5, 12, 40). Courts are given wide discretion in managing their dockets and
appellate courts do not interfere absent a showing of a clear abuse of that
discretion. Clanton v. Clark, 639 S.W.2d 929, 931, (Tex. 1982). The fact is, the
court did not defer ruling on the amount of anyone’s interest - that was never in
question. What the court deferred was ruling on any outstanding claims for
17 contribution which were to be taken into consideration before the court divided the
money.
Rule 760 requires a court to determine the shares and interests of the joint
owners, as well as all questions affecting title to the land which may arise in the
initial phase of the partition action. Tex. R .Civ. P. 760. Here, the parties agreed
their interests would be sold, and there were no questions affecting any title to
those interests. Instead, Long is complaining about claims for contribution, which
claims were expressly reserved by the court and agreed by the parties and the court
not to be waived. (RR 2 14 ll 17-19; 17 ll 2-12, 20-24; 27 ll 2-12; RR1 17 ll 6-10).
These monetary claims would simply affect how much of the proceeds from the
sale the parties would receive. (CR 1 33; Long brief at 45). They would not affect
anyone’s title or share of the property in question.
Long’s complains that any matters decided in the first judgment may not be
considered in an appeal from the second. (Long brief at 43). This is true, but here,
the issues relating to any claims for contribution were expressly reserved.
Moreover, everyone understood and agreed that any claims for contribution were
going to decided later and the proceeds of the sale divided accordingly. (RR1 14 ll
17-19; 17 ll 6-10; RR2 14 ll 7-24; 27 ll 2-12).
Finally, in the last issue, Long argues that the trial court erred by denying the
request for a jury trial. (Long brief at 7, 13, 49). While it is true that Long
18 requested a jury trial in his pleadings, he also represented one was necessary on the
issue of whether the land was capable of being partitioned in kind. (CRI 119). At
the first hearing Tate’s counsel explained that they would agree to selling the
interests in an effort to expedite matters and avoid having to have a jury trial. (RR
1 6 ll 4-25; 7 ll 1-6). Long never mentioned wanting a jury trial again. Nor did
Long or Woodbine ever make any complaint with the court about the court’s
failure to hold a jury trial. In proceeding with the hearings without complaint,
Long has likely waived any such complaint. See Puntarelli v. Peterson, 405
S.W.3d 131, 134 (Tex.App.—Housont [1st Dist.] 2013, no pet). Furthermore, even
had the issue been preserved, there was no error. The court proceeded according to
the stipulations and representations of the parties.
ARGUMENT AND AUTHORITIES
Reply to Issue 1
The Court had jurisdiction and “prudential power” to order the mineral interests sold and the proceeds partitioned as requested by both sides.
Long argues that the trial court was “without either the ‘jurisdictional’ or
‘prudential power’ or ‘prudential authority’ to proceed to partition the leasehold
estate of the Young and Thrash Leases without the joinder of owners of all the
undivided leasehold interests in the Young and Thrash Leases.” ( Long brief at 2).
Long claims the court erred in denying the plea in abatement and also in
19 proceeding to judgment because the court was without either jurisdiction or the
prudential power to sign the order. Id.
An appellate court reviews the trial court’s ruling on a plea in abatement
using an abuse of discretion standard. See Wyatt, 760 S.W.2d at 248. A trial court
abuses its discretion when it reaches a decision so arbitrary and unreasonable as to
amount to a clear and prejudicial error of law. Johnson, 700 S.W.2d at 917. A
court acts arbitrarily and unreasonably when it acts without reference to guiding
rules and principles. Downer, 701 S.W.2d at 241-42.
Long argues that “Tex. R. Civ. P. 757 sets forth jurisdictional requirements
for bringing a partition action, and among its requisites, is that all persons holding
a cotenancy interest in the possessory estate are joined as parties.” (Long brief at
15). According to Long, the joinder of all parties is jurisdictional in a partition
action even after Rule 39 was amended. Tex. R. Civ. P. 39.
In truth, it is not even necessary to decide which rule governs the joinder of
parties in this case. The parties agreed that the court had subject matter jurisdiction
and also agreed and even requested the procedure the court followed in this case.
Long acknowledged that this “was not just a straight partition action where you’re
going to parcel it out and sell it, but it goes to the question also of contribution
claims, and the Court assumes jurisdiction over it under our agreement.” (R 2 17 ll
7-12).
20 But the fact is, as Tate urged, it was not necessary to join the owners of the
remaining 1/8th interest in these leases. Long and Tate jointly owned 7/8 th of the
working interest in the Young and Thrash leases and that was the property sought
to be partitioned. (RR 1 4 ll 4-16). So Long and Tate owned all of the interest
sought to be partitioned. They acquired their interests from Bonanza which had
acquired them from Granite. (CR II 214, 224-225).
Rule 757 reads: “Upon the filing of a petition for partition, the clerk shall
issue citation for each of the joint owners, or joint claimants, named therein, as
in other cases, and such citations shall be served in the manner and for the time
provided for the service of citations in other cases.” Tex. R. Civ. P. 757. Again,
Long and Tate were the only joint owners of the 7/8th working interest.
Long argues that, “First, Texas courts have long recognized that Tex. R. Civ.
P. 757 sets forth jurisdictional requirements for bringing a partition action, and
among its requisites, is that all persons holding a cotenancy interest in the
possessory estate are joined as parties.” (Long brief at 16). Long cites Ward v.
Hinkle, 117 Tex. 566, 8 S.W.2d 641 (1928), for the proposition that: “It is well
settled in this court, that whenever in the course of a partition suit it is disclosed
that all who have an interest in the property to be divided are not parties, it is the
duty of the court to arrest the proceedings until they are made parties, and this
21 should be done at any stage of the case.” Id., at 579, 645 quoting Maverick v.
Burney, 88 Tex. 560, 32 S.W. 512 (1895).
Here, all parties who owned an interest in the property to be divided, namely
the 7/8th working interest, were parties to the suit. This was not a suit to divide or
sell a tract or parcel of land, but instead to sell a separate and defined interest in oil
and gas. Long and Tate were the only indispensible parties since they were the
only co-owners of the interest sought to be partitioned. The sale of their 7/8th
interest would have no affect on the owners of the remaining 1/8 th.
Moreover, Long’s argument does not support the conclusion that had there
been a failure to join all necessary parties the court would have lacked either
jurisdiction or prudential power to proceed. The lack of necessary parties to a
partition does not deprive the court of subject matter jurisdiction. See Hudson,
2014 Tex. App. LEXIS at 12660. Instead, under Rule 39, the trial court is to decide
whether it has authority to proceed and if it does proceed, then its judgment is
considered a final and complete adjudication of the dispute as to the parties before
the court. See Brooks, 141 S.W.3d at 162.
Long acknowledges that the Supreme Court’s pronouncements in Brooks,
141 S.W.3d at 162, might defeat the argument that this was jurisdictional, but
argues that if this Court decides it is not jurisdictional, then it should be reviewed
under a “prudential power” standard of review. (Long brief at 20). Long contends
22 that in Brooks, the court noted the preference “to address non-joinder issues under
a ‘prudential power’ standard of review.” As noted above, the correct standard of
review is abuse of discretion. It is unclear what Long means by a “prudential
power standard of review,” but presumably it would require a finding that the court
acted with prudence.
Long also argues that there really is no distinction between jurisdiction and
prudential power, except whether the issue is fundamental error when not raised
below. Id. Long contends that the question whether this is fundamental error isn’t
at issue here since it was preserved below. This argument misses the point and
completely glosses over the distinction the Texas Supreme Court was making in
Brooks. In Brooks, the Supreme Court disagreed that the absence of parties
deprived the court of jurisdiction. See Brooks, 141 S.W.3d at 161-2. The Court
held that the question was not one of jurisdiction, but rather whether the trial court
should have proceeded to enter judgment when a subset of homeowners had not
been joined in the suit. Id., at 162.
Long relies on this Court’s opinion in Carper v. Halamicek, 610 S.W.2d
556, 558 (Tex. Civ. App.--Tyler 1980, writ ref'd n.r.e.). Carper should not be
controlling since it dealt with a tract of land, not an oil and gas interest. While, in
Carper, this Court recognized that “Proceeding without an ‘indispensible’ party
was previously regarded as fundamental error and stripped the court of jurisdiction
23 to decide a case;” it then decided that the lack of a necessary party in a partition
was indeed one of those rare instances that might deprive a court of jurisdiction to
proceed. Carper, 610 S.W.2d at 557. The biggest difference between Carper and
the current case is that there, the absent parties’ rights had been adjudicated
without their presence or participation. Id., at 559. Their interests were affected
and their rights adjudicated without their participation in the suit. Here, all that
was affected was Long and Tate’s 7/8th interest. The remaining 1/8th interest was
not affected by the suit, nor were the owners of the other 1/8th rights adjudicated in
any way. Further, the owners of that interest would not be estopped from filing
any claim against the participating parties.
Another difference is that in Carper, the Court was requested to file and did
file findings of fact and conclusions of law. Id., at 557. Here none were requested
or filed. When no findings are requested or filed, the reviewing court implies all of
the findings of fact necessary to support the judgment. BMC Software Belg., N.V.
v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002). “When the appellate record
includes the reporter’s record and clerk’s record, these implied findings are not
conclusive and may be challenged for legal and factual sufficiency in the
appropriate appellate court. Id.
24 Long also cites a number of cases that are distinguishable to this one. In
Gilmer Indep. Sch. Dist. V. Dorfman, 156 S.W.3d 586, 588 (Tex. App. Tyler 2003,
no pet.) [Long brief at 20], this Court addressed the need for the Commissioner of
Education to be joined in a suit to declare a statute unconstitutional. Love v.
Woerndell, 737 S.W.2d 50 (Tex. App. – San Antonio 1987, writ denied) [Long
brief at 21] addressed the failure to join all heirs in a suit affecting the title to real
property. The court wrote, “The heirs of a decedent are jurisdictionally
indispensible parties to a suit against the estate which involves real estate….”
Clearly a ruling in that case adjudicating title to property of an estate would affect
all heirs. That is not the case here. Here, Tate and Long were the only owners of
the property to be affected, namely the 7/8th working interest. No one else would
have their interests altered or affected by the Court’s order to sell that 7/8 th.
Dukes v. Migura, 758 S.W.2d 831, 832 (Tex.App.—Corpus Christi 1988),
rev’d on other grounds, 770 S.W.2d 568 (Tex. 1989) [Long brief at 21], involved
the foreclosure of a lien on real property securing a debt. There the court
recognized that “Thus, under current Rule 39, the failure to join ‘necessary’ or
even ‘indispensable’ parties does not render a judgment void and totally
unenforceable. It is enforceable between the parties which were before the court
and is res judicata to them.” Id., at 833. The court then stated,“A judgment may
be void in part and valid in part, provided the valid portion is not so dependent on
25 the invalid that it falls with it. Kubena v. Hatch, 144 Tex. 627, 193 S.W.2d 175,
177 (1946); State v.Blair, 629 S.W.2d 148, 150 (Tex. App. -- Dallas), aff'd, 640
S.W.2d 867 (Tex. 1982). We hold that the first judgment is void insofar as it
purports to affect appellant's interest and cannot be enforced against that interest.
No valid lien on appellant's interest in the devised realty exists.” Id., at 834.
Long also contends that Mustang Drilling, Inc. v. Cobb, 815 S.W.2d 774
(Tex.App.—Texarkana 1991, writ denied) supports Long’s argument rather than
Tate’s. (Long brief at 23). Long is wrong -- Mustang Drilling supports Tate. The
question in Mustang Drilling was whether a 1933 partition had actually divided the
surface and the minerals, or just the surface. Mustang Drilling, 815 S.W.2d at 775.
Cobb had argued that the minerals were not covered, because all mineral owners
were not parties, and the court therefore did not have the mineral estate before it.
Id., at 777. The court disagreed, finding “all those owning shares of the estate of
Joe and Lemmer Pierson, both as to surface and minerals, were parties, and it was
the estate that was being partitioned.” Id. In other words, the court looked at what
interests and/or property were affected by the partition. There, everyone owning a
share of the estate was a party. Here, everyone owning any portion of the 7/8 th
working interest was a party. No one else’s interests were involved or affected.
26 Long also argues that Tate misconstrued the holding in Texas Oil & Gas
Corp. v. Ostrom, 638 S.W.2d 231 (Tex.App.—Tyler 1982, writ ref’d n.r.e.). (Long
brief at 25). In Ostrom, this Court wrote:
Rule 39(a) no longer speaks of ‘necessary’ and ‘indispensable’ parties, and Texas courts have begun to discard these terms. Carper v. Halamicek, 610 S.W.2d 556, 557 (Tex. Civ. App. -- Tyler 1981, writ ref’d n.r.e.). Moreover, Rule 39 focuses not so much upon whether the court has jurisdiction, but upon whether the court ought to proceed with the parties before it. Cooper v. Texas Gulf Indus., Inc., 513 S.W.2d 200, 204 (Tex. 1974). The Cooper decision did not rule out the possibility that a party’s absence would deprive the court of jurisdiction to adjudicate the dispute between the parties before it; however, it did state that this situation would be ‘rare indeed.’ Id. One commentator has noted that under Rule 39 any change should be to lessen the number of ‘indispensable’ parties. Moreover, ‘if a party were held not indispensable under the prior rule, he should not be held indispensable under the amended rule [Rule 39]. 1 McDonald, Texas Civil Practice § 3.23 (1981).
Ostrom, 638 S.W.2d at 233. This Court also wrote, “The general rule in a partition
case is that all owners of property must be joined. Ward v. Hinkle, 117 Tex. 566, 8
S.W.2d 641, 645 (1928); Carper v. Halamicek, supra; Clegg v. Clark, 405 S.W.2d
697, 698 (Tex. Civ. App. -- Waco 1966, writ ref’d). Implicit in this rule is that the
owners who must be joined are the owners of the property sought to be
partitioned.” Id.
This Court held that the royalty owners were not necessary parties, and
while the Court talked in terms of non-possessory interests, etc., it noted that the
non-possessory interest owners’ interest would be neither increased nor decreased.
Id., at 234, citing Veal v. Thomason, 138 Tex. 341, 159 S.W.2d 472 (1942). This 27 Court concluded that the absence of the lessors and royalty owners did not deprive
the Court of jurisdiction to adjudicate the dispute as to the parties before it. Id. This
Court also noted in Ostrom that “The trial court is vested with broad discretion
concerning questions of joinder. Thus we will reverse only with a clear showing
that it has abused its discretion.” Id., at 235, n. 7.
Finally, Long argues that Tate has failed to recognize the underlying
practical and policy reasons for the joinder of all those owning an interest. (Long
brief at 29). Yet, it is Long that fails to see these reasons. Long and Tate were co-
owners of 7/8th of the working interest. They wanted to part ways and divide their
respective interests. While Tate originally sought to partition the interest in kind,
Long argued it was not susceptible to partition in kind, but had to be sold. Tate
decided to agree with Long. His counsel explained that in doing so, this would
eliminate the need for the jury trial, expedite matters and be an efficient and
economical way to resolve the case. (RR 1 7 ll 1-6). The court actually granted
the abatement to take up the party question. (RR 1 24 ll 3-4). The court
subsequently denied the motion after giving the parties the chance to fully brief the
issue. (CR II 363).
Tate is correct that all that was ever sought to be partitioned was their joint
interests – the 7/8th interest. Long is correct that they will each continue to share
their interests with the outstanding owners of the remaining 1/8th. Contrary to
28 Long, the court could and did grant complete relief as to these parties. Ordering the
division of these two partners’ interests and selling it as requested by Long should
have no effect on the outstanding 1/8th interest. As such, the order is final and
enforceable as to Long and Tate.
Reply to Issue 2
Tate and Miken Oil properly pled an action in partition of these mineral interests under Rule 756 and the court was correct to deny Long and Woodbine’s special exceptions on this ground.
Long continues to complain about the absence of the 1/8th interest owners,
this time couching it in terms of error “in awarding the judgment by denying
Long’s Special Exceptions.” (Long brief at 2). Long contends that Tate and Miken
failed to properly plead an action for partition. (Long brief at 2). “Special
exceptions may be used to challenge the sufficiency of a pleading. TEX. R. CIV. P.
91; Friesenhahn v. Ryan, 960 S.W.2d 656, 658 (Tex. 1998). The purpose of a
special exception is to compel the clarification of the opposing party's pleading
when that pleading is not sufficiently specific or fails to plead a cause of action.
See Baylor Univ. v. Sonnichsen, 221 S.W.3d 632, 635 (Tex. 2007). A trial court
has broad discretion in ruling on special exceptions. See id. A trial court's ruling
will be reversed only if there has been an abuse of discretion. See Aldous v. Bruss,
405 S.W.3d 847, 857 (Tex. App.—Houston [14th Dist.] 2013, no pet.). Pleadings
are liberally construed, but special exceptions are appropriate when a pleading
29 does not meet the threshold of "fair notice" of the pleader's contentions. See id.”
James v. Underwood, 438 S.W.3d 704, 715 (Tex.App.—Houston [1st Dist.] 2014,
no pet.).
Long correctly notes that the court held a hearing on these special
exceptions. (Long brief at 35). Long also admits that the court never expressly
ruled on the special exceptions. (Long brief at 35). However, Long contends that
the denial of these special exceptions would be implied. Long cites Guerrero v.
Salinas, 2006 Tex. App. LEXIS 8562, 9, 2006 WL 2294578 (Tex. App. -- Corpus
Christi 2006, no pet.) as support. (Long brief at 35). There, the court actually
noted that “Where the record does not show the movant obtained a ruling on the
special exceptions, the movant has failed to preserve this complaint for appellate
review. DART v. Edwards, 171 S.W.3d 584, 587 (Tex. App.--Dallas 2005, pet.
denied) Here, however, because trial did proceed on the pleadings as filed, and
because the trial court's denial of the special exceptions is essentially
acknowledged by all parties and supported by the record, we infer that the trial
court denied the special exceptions.” Id.
The Court in Guerrero also noted that:
The trial court has wide discretion in ruling on special exceptions. Mulvey v. Mobil Producing Tex. & N.M., 147 S.W.3d 594, 603 (Tex. App.--Corpus Christi 2004, pet. denied); Kutch v. Del Mar College, 831 S.W.2d 506, 508 (Tex. App.--Corpus Christi 1992, no writ). To determine whether a trial court abused its discretion, we must decide whether the trial court acted
30 without reference to any guiding rules or principles, in other words, whether the act was arbitrary or unreasonable. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42, 29 Tex. Sup. Ct. J. 88 (Tex. 1985). Merely because a trial court may decide a matter within its discretion in a different manner than an appellate court would in a similar circumstance does not demonstrate that an abuse of discretion has occurred. Id.”
Guerrero, 2006 Tex. App. LEXIS 8562 at 6-7.
Unlike the facts in Guerrero, it is questionable whether Long preserved this
issue for review. While Long had filed special exceptions, no ruling was ever
obtained and instead the court proceeded with the procedure it found to be agreed
upon by the parties. At the conclusion on the hearing covering the special
exceptions, the court stated, “And I would be at this point in time to be inclined,
and I would think ya’ll would hopefully want to get all of that resolved before this
Court, if possible.” (RR 1 20 ll 1-20). Long and Woodbine’s counsel replied,
“Yes, sir.” (RR 1 20, ll 3). The court then stated, “If possible. Okay. Everybody
is shaking their head yes for the record.” Id., ll 4-5. The court then summarized,
“All right. Let’s go through this. The parties, that’s the first dominant issue, to
make sure we have all parties before the Court with affidavits filed before the
Court under oath with any interest either party might have, know of, et cetera. The
Court will rule upon necessary parties at that time.” (RR 1 21, ll 6-11). The court
concluded, “All right. So we determine the parties, make sure we have all parties
before the Court. At that time, subject to whatever interest they might have or
whatever arguments they might have, order the property sold, and then determine 31 ownership of the property.” (RR 1 22 ll 10-14). At a later hearing, after getting
assurance that they would not waive anything, Long and Woodbine again agreed
with the court as to the procedure that would be followed. The court again set out
the procedure to be followed, advised that the remaining dispute at that time was
“the party issue, and the additional other lawsuits.” (RR 2 23-25).
Long and Woodbine should be found to have waived any complaint
regarding the denial of their special exceptions, but that doesn’t matter since the
court would have acted well within its discretion had it issued such a ruling. “The
trial court has a duty to schedule its cases in such a manner as to expeditiously
dispose of them. For this reason the court is given wide discretion in managing its
docket, and we will not interfere with the exercise of that discretion absent a
showing of clear abuse. No such abuse has been shown here.” Clanton v. Clark,
639 S.W.2d 929, 931 (Tex. 1982).
Reply to Issues 3, 4, and 5
There was sufficient evidence to support the trial court’s order.
The court correctly ordered the mineral interests jointly owned by the parties sold as requested by both sides. It was undisputed that Tate and Miken owned an interest and the order correctly reflected that it was partitioning all of the property jointly owned by the parties.
32 Reply to Issue 4
There was sufficient evidence to support the court’s order as to Tate and Miken.
Long and Woodbine pled and stipulated that the mineral interests were not subject to partition in kind and agreed that they should be sold.
When considering a legal sufficiency challenge after a bench trial, the
reviewing court views the evidence in the light most favorable to the trial court's
findings, crediting favorable evidence if reasonable fact-finders could, and
disregarding contrary evidence unless reasonable fact-finders could not. City of
Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). The court must indulge every
reasonable inference that would support the trial court's findings. Id. at 822. "The
final test for legal sufficiency must always be whether the evidence at trial would
enable reasonable and fair-minded people to reach the decision under review." See
Id. at 827.
In the review of a factual sufficiency complaint, the court reviews all of the
evidence in the record. Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex. 1996). The trial
court’s factual findings will be overturned only if they are so against the great
weight and preponderance of the evidence as to be unjust. Maritime Overseas
Corp. v. Ellis, 971 S.W.2d 402, 406 (Tex. 1998). A factual sufficiency challenge
33 from a bench trial is reviewed in the same manner as a jury trial. K.C. Roofing Co.,
Inc. v. Abundis, 940 S.W.2d 375, 377 (Tex.App -- San Antonio 1997, writ denied).
A review of the factual sufficiency from a bench trial involves the review of the
trial court’s findings of fact. When those findings are missing, the reviewing court
presumes that the trial court found all fact questions in support of the judgment.
IKB Industries v. Pro-Line Corp., 938 S.W.2d 440, 445 (Tex. 1997).
Long begins by arguing that the trial court made certain findings and
conclusions which are in error. (Long brief at 35). Long then refers this Court to
the Order in question. (CR IV 1116). As noted above, no findings of fact were
requested or filed in this case. And the rules expressly provide that “Findings of
fact shall not be recited in a judgment.” Tex. R. Civ. P. 299a. Moreover, even if
these were properly considered the findings of the court, Long’s arguments have
no merit.
Long complains that the court abated the matter to proceed with
consideration of the proper parties. (Long brief at 35). Long argues that there was
no proper evidence before the court as to ownership at the time it entered its order.
(Long brief at 36). Both sides briefed the issue and provided what evidence they
wanted considered. (CR II 213, 296). And as discussed above, there was never any
question that Tate and Long owned the 7/8 th interest sought to be divided. Long
and Woodbine even recounted the history of Tate and Long’s ownership in their
34 Counterclaim and Plea in Intervention and requested a declaration of co-tenancy.
(CR I 28-39). At the first hearing, Tate’s counsel represented that there was no
question but that Tate and Long owned 7/8th of the working interest in the Young
and thrash leases. (RR 1 5 ll 14-16). In response, Long and Woodbine’s counsel
argued that even if the parties agreed as to their interest, the owners of the
outstanding 1/8th would be affected and needed to be joined. (RR 1 10 ll 18-19).
What Tate and Long owned has never been the issue. In fact, Long even
acknowledged that interest in the brief. (Long brief at 37). Instead, Long only
argued that the outstanding interest owners had to be joined. And even then, Long
and Woodbine appeared to drop that argument when assured that any claims for
contribution would not be waived. (RR 2 ll 17-24).
Long also contends that the court ordered the entire 8/8 th sold, but that is not
what is reflected in the order. The order provides that Tate and Long are the
owners of the interests attached in Exhibits A and B. (CR VI 1116). Those
exhibits are the sale documents from Bonanza of its interests to Tate and Long.
(CR VI 1117 & 1122). The court simply ordered that the property owned jointly by
Long and Tate be sold and the proceeds be distributed according to the further
orders of the court. (CR VI 1116).
Long complains that the order recites that Long and Riverine were the
owners of the interests together with Tate and Miken. (Long brief at 36). Riverine
35 was in fact non-suited from the Gregg County suit before the transfer. (CR I 19).
However, as the court noted that the proceeds would be divided later pursuant to
the further orders of the court, any error in including Riverine would be harmless
error and can be resolved when the issues of contributions and claims are finally
resolved by the trial court.
Long also complains that the order found the property was not susceptible to
being partitioned in kind. (Long brief at 37). From the very beginning it was Long
that argued the property was not capable of being partitioned in kind. (CR I 116,
188). In his second amended answer Long even stated that if the property was to be
partitioned it “should be by sale, not in kind.” (CR I 188). And Long expressly
represented to the court at one hearing that “We agree that that is not susceptible to
being partitioned in kind.” (RR 1 ll 16-20). While Long acknowledges this
stipulation, he contends that it was not valid without the joinder of the outstanding
interest owners. (Long brief at 38). Long also argues that while he made the
stipulation, there was no clear and unambiguous stipulation or announcement and
that this stipulation was conditioned upon timing and ripeness.
A stipulation is “an agreement, admission, or concession made in a judicial
proceeding by the parties or their attorneys respecting some matters incident
thereto.” Shepherd v. Ledford, 962 S.W.2d 28, 33 (Tex. 1988). Courts favor
stipulations to expedite litigation, and as a general rule, valid stipulations are
36 binding on the parties. See e.g. New v. First Nat’l Bank, 476 S.W.2d 121, 124
(Tex.Civ.App. – El Paso 1972, no writ). “Orderly judicial procedure requires that
admissions and stipulations properly comprising the record be observed. The
reviewing Court is likewise bound by the stipulation of the parties.” Id., at 122-23,
internal citations omitted. The fact is, the stipulation would be binding on Long
and Woodbine since they were the ones who made it, not only in open court, but in
written pleadings. Moreover, the court was entitled to rely upon the parties’
stipulation as constituting sufficient evidence of that fact and there would be no
error in the trial court making such a finding.
The evidence was sufficient to support the trial court’s order.
Reply to Issue 6
The court properly appointed a qualified receiver to handle the sale of the jointly owned mineral interests.
Here, for the first time, Long complains about the court’s appointment of a
receiver to sell the property. As with many of Long’s other issues, this complaint
also requires a showing of an abuse of discretion. See Green, 593 S.W.2d at 764.
The court carefully laid out the procedure it was going to adopt, which was
approved by the parties and implemented by the order. At one of the two hearings,
the court explained that, “So then the order of the Court would be that you’re not
waiving any rights for contributions under the statute because you’re allowing the
37 case – the property to be sold first without making that determination prior to the
sale of the property.” (RR 2 17 ll 20-14). In its order, the court then appointed
Ronnie Swink as receiver to sell the property by public or private sale. (CR VI
1116). No one ever complained to the court about the appointment of Mr. Swink
and the court was well within its discretion to appoint a receiver in this case.
Rule 770 provides: “Should the court be of the opinion that a fair and
equitable division of the real estate, or any part thereof, cannot be made, it shall
order a sale of so much as is incapable of partition, which sale shall be for cash, or
upon such other terms as the court may direct, and shall be made as under
execution or by private or public sale through a receiver, if the court so order, and
the proceeds thereof shall be returned into court and be partitioned among the
persons entitled thereto, according to their respective interests.” Tex.R.Civ.P. 770.
Here as discussed above, the parties agreed numerous times to the sale of the
property.
Long complains that Tate failed to make application for a receiver. (Long
brief at 39). As discussed at length above, Tate sued Long for partition of the
property. Long responded that the property could not be partitioned in kind, but
needed to be divided. Tate agreed and the court carefully crafted its order around
what it understood to be the parties’ agreement.
38 In Green, 593 S.W.2d at 764, the court rejected a similar argument as being
“wholly without merit.” The court then noted that receivers have been appointed in
practically every partition case pursuant to Rule 770. Id. The court concluded that:
“The appointment of a receiver lies within the discretion of the court and may be
invoked whether specifically prayed for or not.” Id. Here, the court acted within its
discretion to appoint a receiver.
Long complains that the Order did not require the receiver to take an oath or
post a bond as required by sections 64.022 and 64.023 of the Civil Practice &
Remedies Code. Nowehere in the record is it reflected that Long or Woodbine ever
made this complaint to the trial court. The order was entered on July 13, 2014. The
Texarkana Court of Appeals rejected a similar argument in In re Davis, 418
S.W.3d 684 (Tex.App.—Texarkana 2012, orig. pro.). There, the court found that
the complaint had not been made known until well after the receiver was appointed
and had not been preserved under Appellate Rule 33.1(a)(1). Tex. R. App. P.
33.1(a)(1). In another case, the Dallas Court overruled a similar complaint finding
that the record was silent on the issue and further finding that even if a silent
record could be sufficient to show the receiver had not been sworn, the record
failed to show the receiver had assumed his duties. Davis v. Davis, 2013 Tex.App.
LEXIS 5525 (Tex.App.—Dallas 2013, no pet.). The court did not abuse its
discretion in appoint Mr. Swink as receiver.
39 Reply to Issues 7 and 8
The court proceeded properly and the parties stipulated that no issues would be waived pending the second phase of the partition proceeding.
The court entered its order after conducting a proper hearing with all parties and after the parties agreed on the record that the interests be sold and the money deposited into the registry of the court; further, the court and the parties agreed that on the record that Long and Woodbine were not waiving any claims for contribution.
Long complains that the court deferred ruling on the interests and
outstanding claims until after the property was sold. (Long brief at 40). Long
complains that under the rules certain matters are required to be determined in the
first phase of the partition. (Long brief at 41). Rule 760 reads, “Upon the hearing
of the cause, the court shall determine the share or interest of each of the joint
owners or claimants in the real estate sought to be divided, and all questions of law
or equity affecting the title to such land which may arise.” Tex.R.Civ.P. 760. Long
argues that the court failed to follow this rule. Long is wrong. As discussed above,
the parties agreed that the property should be sold. As such, there was no question
of law or equity that would affect title. Instead, those questions would affect what
amount of the proceeds each party should receive and this was what was deferred
for a later hearing. 40 Long cites to Hanrick v. Gurley, 93 Tex. 458, 54 S.W. 347 (1899). While the
court in Hanrick discusses the principles of contribution and the need to adjust the
equities in a partition, it has very little in common with the current case and does
not support Long’s argument. Id., at 475. Hanrick involved the claims of several
heirs to title to lands owned by a relative who died intestate. Id., at 463. As title
was involved, the court had to adjust the equities prior to designating how much of
the land each party was entitled to receive.
Long’s arguments regarding res judicata based upon Hanrick are equally
misplaced. As discussed above, the parties agreed to this procedure and the court
was careful to make sure it was adhering to that agreement. At one hearing, Long’s
counsel stated, “So the language of the Court makes it clear that that’s not just a
straight partition action where you’re going to parcel it out and sell it, but it goes to
the question also of contribution claims, and the Court assumes jurisdiction over it
under our agreement.” (R 2 17, ll 7-12). The court agreed, advising the parties
that: “All right. So then the order of the Court would be that you’re not waiving
any rights for contribution under the statute because you’re allowing the case – the
property to be sold first without making that determination prior to the sale of the
property.” (RR 2 17 ll 20-14). Tate’s counsel then said, “I just want to make sure
our position if clear. As far as we’re arguing the timing and the urging that the
leases be sold sooner rather than later, we’re not doing so to try to trick or to lead
41 counsel into some trap. If there’s evidence of that, Mr. Clark and I both have said
on the record today that we’ve stipulated that whatever claims they have of any
kind or character, we will say that they can make those claims against these funds.
We are not trying to say or argue that they would have waived anything, and we’re
willing to say that and we do say that at this time.” (RR 2 27 ll 2-12).
Long relies upon Ellis v. First City Nat’l Bank, 864 S.W.2d 555
(Tex.App.—Tyler 1993, no pet.), for the proposition that whether the property is
susceptible to partition in kind has to be decided in the first hearing. As discussed
above, Long has argued that the property was not capable of being partitioned in
kind from the very beginning. (CR I 116, 188). In his second amended answer
Long stated that if the property was to be partitioned it “should be by sale, not in
kind.” (CR I 188). And Long expressly represented to the court that “We agree
that that is not susceptible to being partitioned in kind.” (RR 1 ll 16-20). So the
court did not have to make that decision – the parties were in agreement that the
property should be sold. And the court was well within its discretion to rely upon
the stipulation of the parties.
Long argues that matters decided in the judgment from the first phase may
not be considered in the appeal of the judgment from the second phase. (Long brief
at 43). That is true since the first judgment is a final and appealable judgment.
However, here these matters were not decided in the first judgment, but expressly
42 reserved by agreement of the parties to be determined by the court later. Long
complains that a fact issue remains as to whether Tate owes Long money and
argues that Tate is attempting to deny Long his right to relief on his claims for
contribution. (Long brief at 45). But as seen above, Tate expressly agreed and
stipulated that Long has in no way waived his right to contribution. (RR 2 27 ll 2-
12). Long continues to urge that matters decided in the first phase cannot be
appealed from the second judgment. (Long brief at 47). But again, this matter was
not determined in the first phase and was expressly reserved by agreement to be
decided later.
Long advised the court several times of concerns about liens and potential
claims. (See e.g. RR 1 16-17). Tate agreed that these claims were preserved for
determination later. (RR 1 17 ll 6-7). Long and Woodbine’s counsel then
represented, “I think we have reserved Woodbine’s position by filing.” (RR 1 17 ll
9-10). To which the Court replied, “Right, And the Court would so order that you
have.” Id., ll 11-12. Another time, Long and Woodbine expressed concerns that
they not waive any rights, stating “if we could have an agreement that’s somewhat
procedurally and substantively binding by agreeing to that method to do it that
we’re not waiving our claim for contribution.” (RR 2 14 ll 17-19). ). Tate agreed
and Long concluded, “So the language of the Court makes it clear that that’s not
just a straight partition action where you’re going to parcel it out and sell it, but it
43 goes to the question also of contribution claims, and the Court assumes jurisdiction
over it under our agreement.” (R 2 17, ll 7-12). The court also agreed, stating: “All
right. So then the order of the Court would be that you’re not waiving any rights
for contributions under the statute because you’re allowing the case – the property
to be sold first without making that determination prior to the sale of the property.”
(RR 2 17 ll 20-14). So there was no question that all parties agreed and the court
ordered this issue be reserved for a later determination. No title to property was at
issue. The contribution Long claimed was monetary, not a different share of the
mineral estate. (CR I 33; Long brief at 45).
Long also includes an argument that Tate should have been denied the right
to partition of the property because he had “unclean” hands based on Long’s
claims for contribution. But as shown, Long agreed that the property should be
sold and the funds divided.
Long cites to Hoover v. Materi, 515 S.W.2d 406 (Tex.Civ.App. – El Paso
1974, writ ref’d n.r.e.). Long is correct that Hoover involved the distribution of
proceeds from a sale. However, Long is incorrect that Hoover supports his
argument. That case involved the distribution of proceeds between two cotenants
following the sale of certain property at a sheriff’s sale. Id., at 407. There the trial
court had already ordered the property sold and the proceeds be divided equally
before one party asked the court to take into consideration a purchase money note
44 and lien the other party has secured against the property. Id. The problem there
was the question of contribution was not timely raised. The court even stated:
Had the issue been timely raised the trial Court could have required in its judgment providing for the Sheriff’s sale, that if Appellant was the successful bidder, the first $10,000.00 of the proceeds of the sale allocated to Appellee be used to pay off the lien placed on the property of Appellee. As noted in 68 C.J.S., Partition, § 144b, p. 239: In actual partition the court may declare that an encumbrancer has a valid lien on the interest of one of the tenants in common; or, if a sale is found necessary, the court may ascertain the amount due and order it paid out of the distributive share of the encumbrancing tenant, and this may be done even after the sale in partition.
Id. Thus, contrary to Long’s argument, Hoover recognizes that the court may
ascertain the amount due and order it paid out of one co-tenant’s share “even after
the sale in partition.”
Here the court proceeded properly. The parties agreed the land could not be
partitioned in kind and that it should be sold and the money divided. The court
ordered the property sold and agreed the proceeds were to be deposited into the
registry of the court. The court would then determine any claims for contribution.
(RR 2 13 ll 8-13; 16 ll 1-8; 17 ll 7-12 and 20-14; 23 ll 11-12; 27 ll 3-12; CR VI
1116).
45 Reply to Issue 9
The court conducted a proper hearing with all parties before entering the order.
Finally, Long complains that he requested and did not get a jury trial. (Long
brief at 49). This Court reviews the trial court’s denial of a jury demand for abuse
of discretion after consideration of the entire record. Mercedes-Benz Credit Corp.
v. Rhyne, 925 S.W.2d 664, 666 (Tex. 1996).
Long pled that whether jointly owned land was capable of partition in kind
was a matter for a jury and requested a jury trial on all matters in partition. (CR I
119). At the first hearing, Tate’s counsel noted this and suggested that by agreeing
to sell the land, as proposed by Long, the parties could expedite matters and avoid
the time and expense related to a jury trial. (RR 1 6 ll 4-25; 7 ll 1-6). Long never
mentioned wanting a jury trial again at either this hearing or the later one.
Additionally, Long did not file any subsequent request or complaint with the court
regarding a jury trial on any matters, nor would any be necessary. As discussed
above, the court simply ordered the interests sold and reserved the question of any
claims for contribution and the proper division of the proceeds until later.
In Puntarelli v. Peterson, 405 S.W.3d 131, 134 (Tex. App. -- Houston [1st
Dist.] 2013, no pet.), Puntarelli had filed a request for a jury trial and paid the jury
fee. However, there was nothing in the record to indicate that he objected to the
court conducting a bench trial. The appellate court wrote, “We agree with Peterson 46 that Puntarelli’s proceeding to a bench trial without objection waived any
complaint.” Id.
Long argues that he pled defenses raising issues of fact including Appellees’
waiver of their right to partition; Appellees’ unclean hands; and whether the
properties were susceptible of being partitioned in kind. (Long brief at 50).
However, he never made that request again after Tate agreed to Long’s suggestion
that the property was not susceptible to partition in kind, but would need to be sold.
The parties agreed that the property should be sold and had stipulated that the court
could determine any claims for contribution after the sale. Long argues that he has
been denied his right to a jury, but again, the court proceeded pursuant to the
parties’ agreement and stipulations.
Even if this issue was properly preserved, which is doubtful, there was no
abuse of discretion. The court acted well within its discretion based upon the
representations of the parties and the lack of any further requests or complaints
relating to long’s jury demand.
CONCLUSION AND PRAYER FOR RELIEF The trial court always acted with deference to guiding rules and principles
and never abused its discretion in implementing the procedure and issuing the
order appealed in this cause. Additionally, there was more than enough evidence,
including stipulations and representations by Long and Woodbine, to support the
47 rulings and order being appealed. The court had the discretion and agreement of
the parties to order the jointly owned interest sold, the proceeds from the sale
deposited and the claims for monetary contribution deferred until a later time. For
all of the reasons set forth in this brief, Tate and Miken ask that this Court affirm
the judgment of the trial court. They ask for any and all additional relief to which
they may be entitled in law or equity as well.
DATE: January 13, 2015 Respectfully submitted, /s/ Deborah Race Deborah J. Race Texas Bar No. 16448700 Ireland, Carroll & Kelley, P.C. 6101 S. Broadway, Suite 500 Tyler, Texas 75703 Tel: (903) 561-1600 Fax; (903) 581-1071
CERTIFICATE OF COMPLIANCE
This brief complies with Texas Rule of Appellate Procedure 9.4(i) because it Contains 12,483 words (excluding the parts of the brief exempted by this rule).
Signed this 13th day of January, 2015.
/s/ Deborah Race
48 CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the foregoing document has been forwarded to the following persons of record as follows on the 13th day of January, 2015:
F. Franklin Honea frank@honealaw.com The Law Offices of F. Franklin Honea 5949 Sherry Lane, Suite 1700 Dallas, texas 75225
Ron Adkison ron@adkisonlawfirm.com The Adkison Law Firm 300 W. Main Street Henderson, Texas 75652-3109
Charles H. Clark CHC@charlesclarklaw.com Law Offices of Charles H. Clark P. O. Box 98 Tyler, Texas 75710
Bruce A. Smith bsmith@wsfirm.com Ward & Smith P. O. Box 1231 Longview, Texas 75606-1231
Clay Wilder cwilder@suddenlinkmail.com Wilder & Wilder, P.C. 200 North Main Street P. O. Box 1108 Henderson, Texas 75653-1108
49 APPENDIX 1 NO. 2013-238
MIKEN OIL, lNC. AND MIKE § IN THE 4 lh JUDICIAL TATE, § ss Plaintiffs, § § v. § DISTRICT COURT OF S ~ LARRY LONG AND RIVERINE 'S S 'S S Defendants. SS RUSK COUNTY, TEXAS
DEFENDANT LONG'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.
Comes nowLARRY LONG (hereinafter referred to as "Long"), Defendant
herein, and WOODBINE PRODUCTION CORP.(hereinafter referred to as
"Woodbine"), Intervenor herein,and tile this its Original Counterclaim and Plea in
Intervention by Woodbine Production Corp., and would respectfully show unto the
Court, as follows:
I. Discovery is intended to be conducted under Level 3 of TEX. R. CIY. P. 190.1 (i.e.
TRCP.190A).
II.
This comt has jurisdiction and venue over the subject matter and the persons
named herein. Larry Long is the Defendant herein and files this his Counterclaim to
protect his rights in this pattition action. Woodbine Production Corp. is a Texas
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODHINE PRODUCTION CORP.- Page I
28 corporation, doing business in Kilgore, Gregg County, Texas. Woodbine has a
justifiable interest in this action and Woodbine is entitled to the relief set forth
hereinbelow. Woodbine's claims, as Intervenor, are claims that arise from the same
transaction or occurrence and have common questions of law or fact as Plaintiff's
original claims herein. Woodbine intervenes in this action both as a creditor of
Plaintiffs and the assignee of certain of Larry Long's rights to contribution with
respect to the cotenancy existing on the leases. Inasmuch as this is an action for
partition of a cotenancy in oil and gas leases situated in Rusk County, Texas, and
Woodbine is asserting its rights as against one of the cotenants and claiming an
equitable lien against the interests of Plaintitfs in the cotenancy, the plea in
intervention is compulsory and must be tiled in this partition action. In this regard,
Tex.R.Civ.P. 760 provides "[u]pon the hearing of the cause, the court shall
determine the share or interests of each of the joint owners or claimants in the real
estate sought to be provided, and all questions of law or equity atfecting the title to
such land which may arise." See also Moseley v. HeGlTell, 171 S.W.2d 337 (Tex.
1943); ]-/ulsey v. Keel, 700 S.W.2d 255 (Tex.App.-San Antonio, 1985, writ ref'd
n.r.e.); Yturria v. Kimbro, 921 S.W.2d 338 (Tex.App.-Corpus Christi 1996, no
pet.); White v. Smyth, 214 S. W.2d 967, 974 (Tex. 1948). In fact, Plaintiffs should
have joined Woodbine in the pattition action, but have failed to do so. In fact,
without a determination of \Voodbine's equitable interests affecting Plaintiffs' title
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.- Page 2
29 to such lands to be partitioned, this Court should abate the proceedings until
Woodbine is joined as a party. Woodbine is aware that the Court has transferred
Woodbine's claims against Plaintiffs to the COUtts of Gregg County, but files this
intervention action inasmuch as the assertion of its claims must be made in this
partition action. The original tiling of this action in Gregg County preceded the tiling
of Woodbine's original action which the COUlt transferred.
Jurisdiction of the subject matter is proper in that the amoLlnt in controversy is in
excess of $1 00,000.
III.
On September 1, 2000, Larry Long and Tate were assigned the mineral
leasehold interests in certain lands situated in Rusk County, Texas (hereinafter
referred to as the "Young Lease" and the "Thrash Lease"). Said leaseholds being
described in Assignment and Bill of Sale from Bonanza Production Company,
recorded in Vol. 2215, p. 342 of the Deed Records of Rusk County, Texas and
Assignment and Bill of Sale from Bonanza Production Company, recorded in Vol.
2215, p. 337 of the Deed Records of Rusk County, Texas. There was no joint
operating agreement signed between Larry Long and Tate and Larry Long and Tate
have been conducting business on the Leases as cotenants only.
From the time of the commencement of such cotenancy to the present,
Woodbine acted as the designated operator of the wells situated on the Young and
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.- Page 3
30 the Thrash Leases with the Texas Railroad Commission. vVoodbine has acted as the
operator conducting operations on such wells at all times, acting as agent for
Assignor and Tate in the common cotenancy estate of the Leases. Woodbine has
rendered services, furnished materials and advanced funds in payment of the
services provided and materials furnished in operations on the wells of the Leases
for the benefit of the common interests of Assignor and Tate.
For many years, Sunoco, the oil purchaser for the oil produced from the
Thrash Lease, accounted to Woodbine for the proceeds fi'om the sale of production.
Woodbine accounted to Long and Tate for their respective shares of proceeds from
production, net of its operating expensesfor wells on the Young Lease and Thrash
Lease. Thus arose a course of performance and course of dealing between the
partieswherein Woodbine reimbursed itself from the proceeds received from Sunoco
for Woodbine's advances of expenses and its services performed and materials
furnished in operating the wells on both the Young and Thrash Leases. \Voodbine
would provide Larry Long and Tate with checks and JIBs which netted out such
expenses, This course of performance was well known to Tate.
Subsequently, Tate directed the oil purchaser to pay him directly for his share
of the proceeds from the sale of production. vVhen such arrangement was changed,
Tate ceased paying and reimbursing Woodbine for its share of the costs of operating I
the wells and marketing the oi I and gas production tl'om the wells on the Young I I_ i
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.- Page 4
31 Lease and the Thrash Lease. When Tate directed Sonoco, the oil purchaser, to pay
him directlY,Tate ceased paying Woodbine for such expenses as identified on joint
interest billings. The joint interest billings and a summary of same are attached
hereto as Exhibit "A."
At this time, Tate is indebted to \Voodbine for a sum in excess 0[$141.432.03
by reason of Tate's failure to pay the joint interest billings to date to reimburse
Woodbine for his share of the costs of operating the wells on the Leases.
Larry Long has provided Woodbine with an assignment and subrogation
agreement which assigns to Woodbine Larry Long's claims as a cotenant for
reimbursement of expenses, as well as his equitable claim against Tate's leasehold
interest in the Young and Thrash Leases for contribution and reimbursement.
IV. DECLARATION OF COTENANCY OF YOUNG AND TRASH LEASES
Pursuant to TEX. eiV. PRAC.& REM. CODE §37.00 I et seq, Woodbine seeks a
declaration of its rights against Tate, with respect to Woodbine's rights to
reimbursement and also seeks judicial recognition of an equitable lien and
constructive trust against Tate's undivided, cotenancy interests in the leaseholds of
the Young and Thrash Leases. \Voodbine seeks a declaration that: (1) a cotenancy
relationship has existed between Long and Tate since September 1, 2000 with
respect to the leasehold estates of the Young and Thrash Leases; (2) that Long, as a
IJEFENIJANT'S ORIGINAL COUNTERCLAIM ANIJ PLEA IN INTERVENTION HY WOOIJHINE PRODUCTION CORP.- Page 5
32 cotenant (through Woodbine), advanced mOl1les for necessary and beneficial
expenses 111 the common interest of the cotenants of the leasehold estates of the
Young and Thrash Leases; (3) that Woodbinehas a right to reimbursement from
Tate, from the proceeds from the sale of production of oil and gas from the Young
and Thrash Leases (for which Woodbine, as Long's assignee, seeks enforcement of
anequitable lien and constructive trust against Tate's leasehold interest in the Young
and Thrash Leases) for monies spent by Long through \Voodbine necessarily and
beneficially for the common interests of the cotenancy (i.e. monies spent for services
provided and materials furnished to operate the wells on the Young and Thrash
Leases); and (4) that Woodbine, as Long's assignee and subrogee,has a constructive
trust or an equitable lien against Tate's leasehold interests in the Young and Thrash
Leases,so as to reimburse Woodbine for such services and materials and that
Woodbine has been properly assigned such equitable lien by Long.
V. REIMBURSEMENT OWEn BY TATE, AS A COTENANT, AND CREATION AND ENFORCEM ENT OF AN EQUITABLE LIEN
As set forth hereinabove, Larry Long and Tate were cotenants, as defined by
the common law of Texas. As such, Woodbine, acting for Larry Long, and by virtue
of the Assignment and Subrogation referred to hereinbelow, is entitled to
reimbursement for monies necessarily and beneficially spent to improve the property
OEFENI)ANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE I'ROI)UCTION CORP.- Page 6
33 in the interest of the common estate. In Neely v. Intercity J\1gmt. CO/p., 732 S. W.2d
644 (Tex.App.-.Corpus Christi 1987, no pet), that court noted the legal relationship
of cotenants, the right of reimbursement for improvements to the common interest,
and the creation of an equitable lien as relief for the failure of a cotenant to
reimburse, as well as the rights of an operator acting as agent for the working
interest participants to recover monies for reimbursement of its advances and
expenses in operating oil and gas wells. That court held in pertinent part:
Intercity claims in its brief that it was acting as agent for the participating working interest owners. An agent is one who is authorized by another to transact business or manage some atTair and to render an accounting of such transaction. Jorgensen v. Stuart Place Water Supply Corp., 676 S.W.2d 191 (Tex. App. -- Corpus Christi 1984, no writ). It denotes a consensual relationship between two patties by which one acts on behalf of another subject to the other's control. Tamburine v. Center Savings Association, 583 S. W.2d 942 (Tex. Civ. App. -- Tyler 1979, no writ). It follows that, as an agent, Intercity may recover only what its principal could recover under the circumstances. During oral argument, Intercity suggested that it was merely a creditor and likened this case to a suit on a sworn account. We note, however, that no contract existed between appellants and Intercity. We do not believe this action is of a character embraced by Tex. R. Civ. P. 185. We hold, therefore, that, if Intercity is to recover, it is as an agent for the palticipating co-tenants.
In Cox v. Davison, 397 S.W.2d 200, 201 (Tex. 1965), the Supreme Court iterated the Texas rule that a cotenant who produces minerals from common propelty without having secured the consent of the other cotenants is accountable on the basis of the value of the minerals taken, less the necessary and reasonable cost of producing and marketing the same. The law \vill imply a contract on the pat1 of one cotenant to reimburse his co-owners for moneys necessarily spent for the benefit of the common estate. Shaw & Estes v. Texas
DEFENI}ANT'S ORIGINAL COUNTERCLAIM ANI} PLEA IN INTERVENTION HY \VOOOBINE PRODUCTION CORP.- Page 7
34 Consolidated Oils, 299 S. W.2d 307, 313 (Tex. Civ. App. -- Galveston 1957, writ refd n.r.e.). The court, in Shaw, held that the cotenant, incurring speculative expenses in connection with the exploration and development of oil, gas and mineral properties, is not entitled to a personal judgment against his cotenant for reimbursement, but is entitled to be reimbursed out of production if and when production results. However, a cotenant has the right to be reimbursed propol1ionately for money necessarily and beneficially spent to improve the property.
Shaw explains that a cotenant who spends money tlnecessarily and beneficiallytl in the interest of the common estate, has the right to be reimbursed proportionately by his associates, and is entitled to a personal judgment and an equitable lien on the cotenant's interest in the common estate. However, in the case of money speculatively spent, a cotenant is entitled to reimbursement out of the share in actual production. In Shaw the court said that all expenses necessarily incurred by keeping the leases in production were reimbursable, but expenditures which did not extend the leasehold estate, i.e., the reworking operations which were unsuccessful and resulted only in salt water which neither preserved nor benetitted the estate were not recoverable. If a cotenant drills a dry hole, he does so at his ovm risk and without the right to reimbursement for the drilling cost. Willson v. Superior Oil Co., 274 S. W.2d 947 (Tex. Civ. App. -- Texarkana 1954, writ refd n.r.e.).
At all times material to this case, Woodbine has undel1aken the responsibi lity
for maintenance and upkeep of the subject property by operations of the oil and gas
wells on the Leases. Accordingly, it has paid the sLIms for the materials furnished
and services provided described in Exhibit "A" attached hereto to protect and
preserve the common interests of the cotenancy of the leasehold interests in the
Young and Thrash Leases. To date, Woodbine has expended $141,432.03 for
improvements, consisting of the matters described in Exhibit "A" attached hereto.
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.- Page I)
35 These improvements enhanced the value of the subject property by at least
$141,432.03.
Neither Long (previously) nor Woodbine, has received any contribution or
reimbursement ti'om Tate for such expenditures listed in Exhibit "A" attached
hereto. Accordingly, Woodbine requests recovery of such expenditures and/or
enhancement ti'oll1 Tate or, alternatively, that the value of such contributions be
awarded to Woodbine by allocating an equitable lien and constructive trust against
Tate's leasehold interests in the Young and Thrash Leases of a proportionately
higher value.
By reason of the foregoing, Woodbine seeks reimbursement from Tate
personally for the sum of$141,432.02 to date, as reimbursement for Tate's share of
monies spent necessarily and beneficially in the interest of the common estate of the
cotenancy on the Young and Thrash Leases, and the recognition and enforcement of
an equitable lien or constructive trust in Woodbine's favor against Tate's leasehold
interest in the Young and Thrash Leases, and judicial foreclosure of said lien and
trust.
VI. QUANTUM MERUIT
As set forth hereinabove, Woodbine provided valuable services and materials,
as set forth in Exhibit A attached hereto, which services and materials were
DEFENI>ANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION IIY WOODBINE PRODUCTION CORP.- Page 9
36 necessarily and beneficially in the interest of the common cotenancy estate of Long
and Tate in the leasehold of the Young and Thrash Leases. Even if., there \vas no ~
express contract covering Woodbine's reimbursement by Long and Tate covering
the services and materials Woodbine furnished; the services and materials were
provided for the common interest of Long and Tate, and Tate directly benefitted
from Woodbine's advances of monies, services provided and materials furnished in
operating the wells on the Young and Thrash Leases. Tate has accepted the services
provided and materials fUl1lished by Woodbine at all times since September of 2000,
with full knowledge and without objection. In this regard, Tate had been billed over
the years for his share of the costs and expenses incurred by Woodbine in operating
the wells on the Young and Thrash Leases, Tate knew that such services and
materials were for his benefit (i. e. Woodbine operating the wells on the Young and
Thrash Leases, enabled the wells to produce oil and gas, which directly benefitted
Tate through his receiving a share of the proceeds from the sale of production of oil
and gas from such wells). Further, at all times, Tate had reasonable notice that
Woodbine expected compensation from him for the advances Woodbine made,
services provided and materials furnished by Woodbine. Notice of such was given in
the form of joint interest billings addressed and mailed to Tate at all times, as well as
the prior"net-back checks" which he received for his share of the proceeds for
production of the wells in the Young and Thrash Leases, less a deduction of
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODBINE PRODUCTION CORP.- Page 10
37 Woodbine's costs and expenses in operating the wells. Therefore, Tate is stopped to
deny the arrangement or to contest the charges. Moreover, Woodbine expected
money from Tate for his one-hal f share of the leasehold interest.
Woodbine is entitled to recover its actual damages from Tate, being the
reasonable value of the services provided and materials furnished, vvhich damages
are in the sum of$141,432.03.
VII. INTEREST
Pursuant to TEX.FIN.CODE §302.002, Woodbine is entitled to recover from
Tate interest at the rate of 6% per year on the principal amounts of the credit
extended beginning on the thi11ieth day after the dates on which the amounts are due.
[n this regard, Woodbine is a creditor, as defined by TEX.FIN.CODE §301.002(3) and
Tate is an obligor, as defined in TEX.FIN.CODE §30 l.002( 13), and Woodbine has not
agreed with Tate on a specific interest rate therefore Woodbine may charge and
receive from Tate legal interest as set forth hereinabove. In this regard, interest
commences thirty (30) days after each joint interest bill ing of Exhibit "A" was
delivered to Tate.
VIII. ATTORNEY'S FEES
Written demand has been made on Tate for payment of the above sums by the
foregoing joint interest billings and by letter dated March 26, 2013. More than thirty
DEFENDANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOOJ)B1NE PRODUCTION CORP.~ Page II
38 (30) days have expired after the above claim was presented, without payment for the
amounts owed being tendered. Woodbine is entitled to recover its reasonable
attorney's fees incurred in this action pursuant to TEX. CIY. PRAC.& REiv1. CODE
§38.001. Further, Woodbine seeks recovery of attorney's fees pursuant to TEX. CIV.
PRAC.& REI',,1. CODE §37.009.
WHEREFORE, PREMISES CONSIDERED, Plaintiffs are served with
process herein pursuant to TEX.R.Clv.P.21 a. Larry Long and Woodbine Production
Corp. pray that upon final hearing hereof, the Coul1 grant judgment in \Voodbine's
favor, for (I) the declaratory relief set forth hereinabove, (2) damages as set forth
hereinabove, (3) imposition of an equitable lien and/or constructive trust, as set forth
hereinabove, (4) interest, both prejudgment and post-j udgment, on the damages
awarded herein, (5) reasonable attorney's fees as set forth hereinabove, (6) all costs
of court, and (7) such other and further rei ief, both general and special, at law or in
equity, to which Long and \Voodbine may show themselves justly entitled.
Respectfully submitted,
ADKISON LAW FIRM 300 ¥l. Main St. Henderson, TX 75652-3109 Telephone: (903) 657-8545 Facsimile: (903) 657-6108 ron@adkis 11 wfir .com
DEFENDANT'S ORIGINAL COUNTERCLAIM ANI) PLEA IN INTERVENTION BY WOOI)BINE PRODUCTION COI{P.- Page 12
39 State Bar No. 00921090
F. Franklin Honea State Bar No. 09934300 LA W OFFICES OF F. FRANKLIN HONEA 5949 Sherry Lane, Suite 1700 Dallas, Texas 75225 (214) 3 61-9494 XI 10 (214) 691-2109 (fax) frank@honealaw.com
ATTORNEYS FOR PLAINTIFF WOODBINE
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the foregoing document has been delivered
. bv f~lcsimile.- a manner in accordance with the Texas Rules of Civil Procedure.- addressed to
the following:
Charles H. Clark Clark & Porter P.O. Box 98 Tyler, Texas 75710 Fax: 903-595-1294
Clay Wilder Wilder & Wilder, P.c. 200 North Main Street Henderson, Texas 75652 Fax: 903-657-5088
DATED this q-l ~ day of ~ W 2013.
I)EFENI)ANT'S ORIGINAL COUNTERCLAIM AND PLEA IN INTERVENTION BY WOODHINE PRODUCTION CORP.- Page 13
40 APPENDIX 2 NO. 2013-238 F/t.ED 2013 OCT -9 pu MlKEN OIL, INC. AND MIKE § IN THE 4th JUDICIAL 11 3: 58 TATE, § JE~~ RU H,yO G= ~n c· l..~:,L"ST eLK § T}. TEXAS Plaintiffs, § BY ~-DEPUTY § v. § DISTRICT COURT OF § LARRY LONG AND RIVERINE § ss Defendants. § RUSK COUNTY, TEXAS
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER
Comes now Defendant, Larry Long ("Long"), and files this his Second Amended
Original Answer, and would respectfully show unto the Court, as follows:
I. GENERAL DENIAL
1. Pursuant to Rule 92 of the Texas Rules of Civil Procedure, Defendant
Larry Long generally denies each and every, all and singular, the material allegations in
Plaintiffs' Second Amended Original Petition (the "Petition") and demands strict proof
thereof, reserving hereby his right to assert any additional defenses which may be
applicable.
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page I
186 II. SPECIFIC DENIALS
A. Jurisdiction and Venue
2. Plaintiffs request a partition of leases on land located in Rusk County.
Pursuant to the Civil Practice and Remedies Code Section 15.011, actions for partition
of real property have mandatory venue in the county in which the property is located.
As all of Plaintiffs' claims arise from the same transaction, occurrence, or series of
transactions, thus all of the causes of action raised are governed by the mandatory venue
provision. ClY. PRAC. & REM. CODE ANN. § 15.004. Therefore, mandatory venue in
this matter is in Rusk County, Texas.
3. Although addressed separately 111 Defendant's Motion to Abate, Plea in
Abatement and Supplemental Plea in Abatement, the lack of necessary parties in this case
is a jurisdictional issue because the non-party, cotenant leasehold interest owners have an
immediate right of possession in the entire undivided leasehold estate. A decree of
partition is therefore "not binding even on those who are parties" unless all holders of
undivided interests are joined. Mustang Drilling, Inc. et al v. Sam B. Cobb, Jr., Trustee,
et aI, 815 S.W.2d 774, 777 (Tex. App.-Texarkana 1991, writ denied) (citing Ward v.
Hinkle, 8 S.W.2d 641 (Tex. 1928)). This rule has survived the amendments to the rules of
civil procedure regarding necessary parties. ld. Certain working interest owners in the
leasehold estates sought to be partitioned by Plaintiffs are not parties to this lawsuit.
Accordingly, this Court may not partition the Thrash and Young leasehold estates
without the joinder of the necessary parties.
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 2
187 4. Additionally, Plaintiff Mike Tate and Defendant Larry Long's actions in
developing and producing the Young and Thrash leaseholds have created an implied
waiver against partition. Dimockv. Louise Kadan.e et aI, Trustees, 100 S.W.3d 602,608
(Tex. App.-Eastland 2003, pet. denied). Relevant acts evidencing the implied agreement
not to partition include Defendant Mike Tate's pledging of his undivided interest as
security through a Deed of Trust and joint development of the leasehold estates.
5. Further, Defendant Larry Long denies that the ownership interests of
Plaintiffs and Defendant in the Young and Thrash Leases are susceptible to being
partitioned in kind. Developed mineral lands held in cotenancy, as a general rule, are not
susceptible to partition in kind because of the elements of uncertainty which are not
resolvable at a reasonable cost. Moreover, a partition in kind of the Young and Thrash
Leases will result in the market values of the "partitioned leaseholds" being substantially
less than the market value of the whole of the present undivided interests in the
leaseholds; hence, if partition is granted, it should be partitioned by sale. To avoid an
unfair division, the lands are to be partitioned by sale and the proceeds distributed to the
parties.
6. As there is no reasonable way to determine how to partition in kind the
minerals at a reasonable cost, the lands should be partitioned by sale, rather than in kind,
and the proceeds distributed according to each party's interest.
III. AFFIRMATIVE DEFENSES AND VERIFIED PLEAS
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 3
188 7. Defendant asserts the following affirmative defenses:
a. Estoppel; b. Failure of consideration;
c. Payment;
d. Statute of frauds; and e. Waiver.
8. There is a defect of parties.
9. Plaintiffs have failed to join all necessary parties for the resolution of this
matter. Tex. R. Civ. P. 39. Specifically, Plaintiffs have failed to join the owners of the
one-eighth working interest in the Young and Thrash leases and holders of liens
burdening the cotenants' interests in the leaseholds to be partitioned. It is essential that
the owners of the entire working interest in these leases be joined as their interests in the
leases will be directly and significantly affected by a partition ruling in this action.
WHEREFORE, PREMISES CONSIDERED, Long prays that Plaintiffs take
nothing by their claims and causes of action set forth in Plaintiffs' Second Amended
Original Petition, that partition be denied, or if partition is granted, the partition be by
sale, that lienholders holding liens against Plaintiffs' interests recover their debts either
by awarding part of Plaintiffs' partitioned leaseholds to them or providing that their liens
be discharged by first applying proceeds awarded to Plaintiffs to the lienholders so that
the indebtedness of Plaintiffs may be discharged and not burden Long's partitioned
leasehold and/or Long's share of proceeds from the sale, and for such other and further
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 4
189 relief. both general and special, at law or in equity, to which Plaintiff may show itself
justly entitled.
ADKISON LAW FIRM 300 w. Main St. Henderson, TX 75652-3109 Telephone: (903) 657-8545 Facsimile: (903 t6S17 -6108 ron@adkisonla-vvfi TI.com
BY: cA-"-- Rin AClkison State Bar No. 00921090
F. Franklin Honea State Bar No. 09934300 LA W OFFICES OF F. FRANKLIN HONEA 5949 Sherry Lane, Suite 1700 Dallas, Texas 75225 (214) 361-9494 XI10 (214) 691-2109 (fax) frank@honealaw.com
ATTORNEYS FOR PLAINTIFF LONG AND WOODBINE
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 5
190 CERTIFICATE OF SERVICE
I certify that a true and correct copy of the foregoing document has been delivered
by facsimile, a manner in accordance with the Texas Rules of Civil Procedure, addressed
to the following:
Charles H. Clark Clark & Porter P.O. Box 98 Tyler, Texas 75710 Fax: 903-595-1294
Clay Wilder Wilder & Wilder, P .C. 200 North Main Street Henderson, Texas 75652 Fax: 903-657-5088
DATED this etc/!: day of OcJo /zer ;/) )9J3. ~ .
f~Z£ f
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 6
191 STATE OF TEXAS § § KNOW ALL MEN BY TIffiSE PRESENTS: COUNTY OF GREGG §
BEFORE ME, the undersigned authority, personally appeared Larry T. Long, who
being by me duly sworn, deposed and stated that he is the Defendant in the above styled
and numbered cause, and that the statements set forth in Paragraphs 8 and 9 in the Answer
are true and correct to his personal knowledge.
Subscribed and sworn to before me on this 9ti. day of /)e~6,e€- , 2013.
~1~OOdim~ .. ' , , ~
. .£lL.. ' ~
the State of Texas
,,"~;'e""',. KAREN DENISE MCKAIN ~f! I ~" '~~ Notary Public. S~8tao, f Taxas .1.. ~~'fJ .~~ My Commission Expires October 23, 2016 If, u\
DEFENDANT LARRY LONG'S SECOND AMENDED ORIGINAL ANSWER Page 7
Related
Cite This Page — Counsel Stack
Larry Long and Woodbine Production Corporation v. Miken Oil, Inc. and Mike Tate, Counsel Stack Legal Research, https://law.counselstack.com/opinion/larry-long-and-woodbine-production-corporation-v-miken-oil-inc-and-mike-texapp-2015.