Marshall v. Amos

1956 OK 186, 300 P.2d 990, 6 Oil & Gas Rep. 337, 1956 Okla. LEXIS 542
CourtSupreme Court of Oklahoma
DecidedJune 5, 1956
Docket36936
StatusPublished
Cited by12 cases

This text of 1956 OK 186 (Marshall v. Amos) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marshall v. Amos, 1956 OK 186, 300 P.2d 990, 6 Oil & Gas Rep. 337, 1956 Okla. LEXIS 542 (Okla. 1956).

Opinion

HALLEY, Justice.

H. D. Amos filed this action in the District Court of Cleveland County, Oklahoma, March 13, 1953, against Ida B. Marshall, H. G. Marshall, her husband, H. G. Marshall, Inc., Titus Haffa, Ethel Haifa and A & P Development Company, a co-partnership and Sinclair Oil & Gas Company, as defendants. H. D. Amos prayed for judgment that Ida B. Marshall held title as trustee for his use and benefit to an undivided one-half of one-eighth of eight-eighths overriding royalty in an oil and gas lease covering the Southeast Quarter of Section 29-10-2, Cleveland County, Oklahoma.

The Sinclair Oil & Gas Company was made a party defendant only because it was purchasing the oil produced from the lease mentioned and plaintiff sought to have the oil runs impounded pending this action. During the pendency of the action Sinclair Crude Oil Company became the successor to the Sinclair Oil and Gas Company and they were merely stake-holders as to the portion of the oil runs here involved.

At the conclusion of plaintiff’s evidence, the court sustained a demurrer to the evidence as to Titus Haifa and A & P Development Company, a co-partnership and *992 dismissed the action as to these defendants. The judgment dismissing the action as to them was not appealed from and became final.

December 6, 1954, the court adopted findings of fact in favor of the plaintiff and rendered judgment in his favor holding that Ida B. Marshall held title to one-half of one-eighth of eight-eighths overriding royalty interest as constructive trustee for the plaintiff, H. D. Amos, allowing one-half of the proceeds accruing from the sale of production from such overriding royalty interest to the date of judgment.

Ida B. Marshall, H. G. Marshall, and H. G. Marshall, Inc., have appealed. Before rendering judgment the court made extensive findings of fact and conclusions of law. It found that fraud had been practiced upon H. D. Amos by H. G. Marshall and his wife, Ida B. Marshall, whereby Amos had been deprived of an interest in the overriding royalty standing in the name of Ida B. Marshall and ordered them to convey such interest to H. D. Amos and also to account to him for one-half of all sums received from such overriding royalty interest.

A clear understanding of the issues involved require a recital of the events leading up to the filing of this action. The evidence shows that H. D. Amos first learned of the 160 acres of land above described in the early part of 1950, through a seismograph employee who told him it would be a good place to buy royalty. Amos went to Norman, checked the records and found that the royalty under the tract was divided into so many small units and selling at such high prices that he gave up the idea of buying royalty. He then learned that S. C. Yingling and associates, Fred Capshaw, E. W. Godwin and A. B. Soper held oil and gas leases from a few of the royalty owners. The four associates named will be referred to hereafter as Soper and associates.

Amos and H. G. Marshall had known each other for a few years and had business dealings together and each was Interested in some phase of the oil and gas business. Amos met Marshall in August, 1950, and Marshall told him that he was looking for a lease that would probably produce from the Wilcox Sand. Amos did not mention the land here involved but contacted Soper and associates and learned that their leases covering this land were for sale. Marshall again asked Amos if he had located a lease that had Wilcox Sand prospects and he told him that he had.

Later Amos and Marshall went to the office of Soper and associates and on September 5, 1950, discussed buying their leases. Marshall said that he had a friend of means in Chicago to whom he thought he could sell the leases.

Capshaw gave them a letter dated September 5, 1950, whereby it was agreed to sell to H. G. Marshall 116 acres of leases at a price of $23,200, provided they could secure a buyer at that price by September 12, 1950, and also reserving to Soper and associates one-sixteenth of seven-eighths overriding royalty. On the same date they gave H. G. Marshall, a second letter whereby they agreed to pay $12.50 per acre if the option to buy as set out in the first letter was consummated by September 12, 1950, as compensation .for his services in securing a buyer for the leases.

Amos and Marshall then went to Chicago and contacted Titus Haifa with whom Marshall had made previous oil and gas deals, and Haifa operated in Oklahoma as A & P Development Company. Only Marshall tallied to Haifa, who agreed to buy the leases on the entire 160 acres at $300 per acre plus an override of one-eighth of eight-eighths royalty. Haifa gave Marshall a check for $48,000 and authorized his attorney in Oklahoma City to prepare an escrow agreement which was dated September 14, 1950, whereby the cash was deposited in escrow in the Liberty National Bank and to be paid when and if titles were approved by Haifa’s attorney in Oklahoma City, and conditioned that not less *993 than 145 acres of leases were to be obtained and approved as to title by Haffa’s attorney. This letter recited that it superseded the above letter of September 5, 1950, and set a time limit of September 25, 1950.

Soper and associates were unable to meet title requirements on 145 acres of leases by September 25, 1950, and no cash was released by the escrow holder. Soper and associates contended that the titles were good but Haffa’s attorney refused to approve the titles.

When it appeared that the deal to sell to A & P Development Company could not be consummated, Haifa came to Oklahoma City in October, 1950, and contacted Marshall and Soper and associates and demanded that his money in escrow be re*, leased and appeared anxious to avoid litigation. He had received reports that an offset well had failed to produce from the Wilcox Sand.

Soper and associates had good leases on a few acres above 116 acres but apparently did not have leases on 145 acres that Haffa’s attorney would approve. Soper and associates finally agreed on October 18, 1950, to accept $15,500.00 for such leases as they had and retain an override of one-sixteenth of seven-eighths royalty in lieu of one-eighth of eight-eighths and also agreed to secure leases on additional-acreage to be paid for out of the escrow money of Haifa when the leases were obtained and titles approved by Haffa’s attorney.

Amos had no part in this agreed settlement and knew nothing of it until some days later. Before Haifa entered into the settlement of October 18, 1950, he required Marshall to execute a release of any claim he had to a commission and gave Marshall the sum of $1000.00 to cover expenses but this release excepted any interest that Marshall might'have in the overriding royalty which will be discussed later.

By an assignment dated January 2, 1952, Titus Haifa conveyed to Ida B. Marshall an overriding royalty of one-eighth of eight-eighths in the leases ‘ accepted by him October 18, 1950.

Nothing was ever paid by him to H. G. Marshall or H. G. Marshall, Inc., except the $1,000 expense money above named and Amos claims that since he and.H. G. Marshall were joint adventurers from the beginning he is entitled to one-half of the overriding royalty given to Ida R.

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Related

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1970 OK 73 (Supreme Court of Oklahoma, 1970)
Crane v. Commissioner
49 T.C. 85 (U.S. Tax Court, 1967)
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1967 OK 178 (Supreme Court of Oklahoma, 1967)
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1965 OK 177 (Supreme Court of Oklahoma, 1965)
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1962 OK 100 (Supreme Court of Oklahoma, 1962)
Marshall v. Marshall
1961 OK 86 (Supreme Court of Oklahoma, 1961)

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Bluebook (online)
1956 OK 186, 300 P.2d 990, 6 Oil & Gas Rep. 337, 1956 Okla. LEXIS 542, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marshall-v-amos-okla-1956.