Smith v. Linden Oil Co.

71 S.E. 167, 69 W. Va. 57, 1911 W. Va. LEXIS 64
CourtWest Virginia Supreme Court
DecidedMarch 14, 1911
StatusPublished
Cited by5 cases

This text of 71 S.E. 167 (Smith v. Linden Oil Co.) is published on Counsel Stack Legal Research, covering West Virginia Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Smith v. Linden Oil Co., 71 S.E. 167, 69 W. Va. 57, 1911 W. Va. LEXIS 64 (W. Va. 1911).

Opinion

Beahnoh, Judge:

Oil 24tli December, 1898, T. EL. Harter and wife made a lease for development of oil and gas to W. S. Miller, trustee, of a tract of 51 acres of land, which lease Miller assigned to the Linden Oil Company. The lease bound the lessee to pay to t}ie lessor Harter a royalty of one-eighth of oil produced, and “to deliver the same free of expense, into tanks or pipe lines to the credit of the party of the first part.” On the 12th October, 1900, by deed recorded 13th October, 1900, Harter and wife conveyed to G. M. Smith and I. M. Dnderwood the undivided thirty-second of the oil that should be produced from the “two first” wells that should be drilled on the land under said lease, for a consideration of $100', and for deferred consideration specified. This conveyance was recorded, and of it the Linden Oil Company and the Eureka Pipe Line Company had notice. When this conveyance of part of Harter’s one-eighth royalty oil was made no well had been drilled. Later the Linden Oil Company drilled wells producing much oil, two of those wells being known in this suit as Harter Well Ho 1 and Harter Well Ho. 2. These are the' wells in whose oil Smith and' Hnderwood claim a thirty-second interest. This oil was run into the pipe line of the Eureka Pipe Line Company, a common carrier. By deed 13th October, 1900, T. Iv. Harter and wife conveyed to Poster Mitchell one-half the oil in said tract subject to said Miller lease, this deed declaring its intent to be to convey to Mitchell one-sixteenth of the oil, that is, half the one-eighth royalty oil reserved by lease to Harter. This conveyance was recorded 18th , October, 1900. Mitchell conveyed various interests in the oil conveyed to him by Harter to D. Daily, C. Meliek and H. E. Wilson. Harter and wife conveyed to W. R. Pitch one sixty-fourth of the oil in said tract. It was discovered that though Harter and wife leased to Miller the entire tract, Harter owned only three undivided fifths, the'remaining two-fifths being owned by George W. Harter and Rebecca J. Harter; and Harter conceding want of title to two-fifths made an agreement with the Linden Oil Company modifying the lease from Harter to Miller, .so that the royalty, instead of the usual one-eighth as therein provided, should be three-fortieths, that is, three-fifths of one-eighth. The Linden Oil Company took a lease from George and Rebecca [60]*60JIarier for their two-fifths. It seems not necessary to make this statement as to the modification of the Miller lease, as Harter’s three-fortieths of the oil is more than the one thirty-second of oil assigned by him to Smith and Underwood.

The conveyance by T. K. Harter of the one thirty-second of the oil is prior in date and prior in recordation to the conveyance of interests in the oil made by Harter to Mitchell and Pitch. The conveyances of fractions of the oil by Harter to-Smith and Underwood, and to Mitchell and to Pitch exceed the three-fifths of the one-eighth royalty oil going to Harter as lessor under his lease to Miller. Smith and Underwood notified the Eureka Pipe Line Company of their right to the one thirtjr-second of the oil in the two wells first to be drilled, and requested that no oil be sold from said farm until proper division orders should be made; and a second time notified the company not to sell oil until their interest or share be set apart, and required the company to render monthly statements of oil coming from those two wells.

When oil came the Linden Company gave no direction to the Pipe Line Company to account to Smith and Underwood for any share in the oil, and the Pipe Line Company would not recognize their right, but refused, alleging conflicting claim, and Smith and Underwood brought this chancery suit praying that the Linden Oil Company be compelled to turn over and deliver to them their share of the oil from those two wells, and make division orders recognizing their right to one thirty-second of the oil so that it might be sold, and that the Pipe Line Company render a true account of the oil run into its pipes from those wells; that a full account be had of such oil as against both companies; that the Pipe Line Company be required to show what disposition had been made of such oil, whether sold or not, and what the proceeds; that a decree be made declaring the one thirty-second of the oil produced from those wells, or to be produced, to be the’property of Smith and Underwood, and that the companies be required to deliver to the plaintiffs their share of the oil. A decree was made declaring Smith and Underwood owners of one thirty-second of all oil produced from said two wells, and that it had not been accounted for, and that it had been run into the pipes of the Pipe Line Company as a [61]*61common carrier of oil; that three-fortieths of the oil from the two wells was going to Harter, and that out of such three-fortieths one thirty-second of all the oil should he set apart and delivered to Smith and TJnderwood. This decree also declared that the oil produced should be divided by the Eureka Pipe Line Company, as follows: to Smith and Underwood 5/160 royalty oil; to T. Iv. Iiarter 7/160 royalty oil; to George Y. Harter 8/160 royalty oil, and to Linden Oil Company 7/8 working interest. The decree referred the case to a commissioner to report the oil from the two wells, and the daily production. The commissioner made a report, which was confirmed without exception by a later decree, holding that the total production was 15,365.68 barrels, and that 7/8 of it, known as the working interest, 13,444.97 barrels was the propérty of the Linden Oil Company; 480.17 barrels to Smith and Underwood; 672.25 barrel^ to T. Iv. Harter; 768.29 barrels to George Y. Harter. It held that the oil of Smith and Underwood had been unlawfully detained from them, and required the Eureka Pipe Line Company to forthwith deliver to them said 480.17 barrels of oil, and place the same to their credit subject to sale by them, free of storage charges. And the decree required delivery to T. Iv. Harter of 7/160 of the oil. The Eureka Pipe Line Company alone appeals.

The question -of equity jurisdiction is raised. There can be no question here. The case is one presenting conflicting claims to royalty oil, and we have held for equity jurisdiction in such, ease. Peterson v. Hall, 57 W. Va. 535; Swearingen v. Steers, 49 Id. 312.

It seems not worthy of mention that the court overruled a demurrer to the first bill based on the absence of T. K. Harter and wife as parties, since they were made parties by an amended bill, thus curing this error, if error.

A complaint is made that the decree 'required the Pipe Line Company to make discovery of the oil run into its line when no officer of it was made a party capable of making discovery. This is answered by the fact that the company filed a statement of such oil, which formed the basis of the decree. The law does require that some officer be made a defendant'when discovery is required, as a corporation discovers by an officer; [62]*62it is a means of discovery for the plaintiffs benefit; but when the corporation does make the discovery, and it is accepted, where is the error?

It is pressed upon us strenuously that the Eureka Pipe Line Company is a common carrier; that it knows not Smith and Underwood or their rights, having no contract with them; that it contracted only with the Linden Company to receive its oil, and that Smith and Underwood must look to Harter and the Linden Company.

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Cite This Page — Counsel Stack

Bluebook (online)
71 S.E. 167, 69 W. Va. 57, 1911 W. Va. LEXIS 64, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smith-v-linden-oil-co-wva-1911.