Sparks v. Midland Supply Company

1959 OK 73, 339 P.2d 1056, 10 Oil & Gas Rep. 984, 1959 Okla. LEXIS 441
CourtSupreme Court of Oklahoma
DecidedApril 21, 1959
Docket38008
StatusPublished
Cited by11 cases

This text of 1959 OK 73 (Sparks v. Midland Supply Company) 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
Sparks v. Midland Supply Company, 1959 OK 73, 339 P.2d 1056, 10 Oil & Gas Rep. 984, 1959 Okla. LEXIS 441 (Okla. 1959).

Opinion

WELCH, Justice.

This is an action by plaintiff and inter-venors to recover judgment against each of the defendants, Floyd Rathbun and E. H. Sparks, for materials furnished, and services performed by plaintiff and inter-venors for certain oil and gas leases, and for foreclosure of liens upon certain oil and gas leases. Judgments were recovered by plaintiff and intervenors against each of the defendants, and the liens were foreclosed. Only E. H. Sparks has appealed from the judgments against him. The parties will be designated as they appeared in the trial court.

In this appeal the questions presented concern the existence or non-existence of a mining partnership as between E. H. *1058 Sparks and Floyd Rathbun, and a contract with the plaintiff Midland Supply Co., Inc. a corporation, for the materials furnished by it.

The defendant has listed fifteen assignments of error, and argued them under three separate propositions, however, we are of the opinion that only two questions are presented for our consideration.

First, Is there competent evidence to sustain the trial court’s finding that E. H. Sparks and Floyd Rathbun were mining partners as to the seven oil and gas leases involved in this action?

Second, Is there competent evidence to sustain the trial court’s finding that E. H. Sparks entered into an oral contract with Midland Supply Company for the purchase of the materials, and the issuance of credit therefor, as to the seven oil and gas leases involved in this action, or as to any of them?

The parties to this appeal agree that in order to establish the existence of a mining partnership there must be co-ownership, co-operation and agreement to share profits and losses as to each lease.

The defendant Sparks admits that the Vaughn lease located in Nowata County is recorded under the joint ownership of Sparks and Rathbun, and that the Tyler lease located in Washington County is recorded in the name of Sparks. However, it is his contention that as to these two leases they were in his name as security for loans. Sparks further admitted that after he was repaid “out of the oil production” and Rathbun was “re-imbursed fpr all expenses he paid on the property” then, he, Sparks, “was to receive one-half of whatever the property produced.” As to the other five leases Sparks claims he never did purport to have any interest in them or any contractual arrangements with Rathbun concerning them. He did admit as development of the leases progressed he was to receive an assignment of the production from “some of those leases. Whatever Rathbun might have production on,” and that “Rathbun signed the statement assigning Sparks the runs off from these other leases he had.”

A written contract was entered into between Rathbun and Sparks as parties of first part, and one Gus D. Hill as party of second part, wherein said contract refers to a certain oil and gas lease or leases in Washington and Nowata Counties, held by parties of the first part. Hill was to assist parties of first part in drilling upon leases, location to be selected by Rathbun. Said agreement further provided that parties of first part should be in full charge and .complete control of drilling operations and marketing product. Sparks’ testimony concerning this contract reveals that he was to receive twenty-five percent of the income from the lease after Hill got all of his money back, which was consideration for getting Hill to drill on it, and that they could have drilled on any of the leases. Only the Hart lease and the Walker lease carried ¾6th overriding royalty interests for the benefit of second party.

There were substantial financial contributions by Sparks during the period here involved. Sparks’ own summary of advance by him to Rathbun from October 12, 1953, to June 5, 1954, showed a total of $25,939, including regular advances in the months of November, December, January, February, and May; these advances were for varying and unusual amounts ranging from $32.57 to $15,006.21.

On December 21, 1953, Max Beren, President of the plaintiff company, had a telephone conversation with Sparks, stating he had information concerning Sparks’ extensive development program on leases, in conjunction with Floyd Rathbun, nearby the company’s Bartlesville store. Sparks agreed that he was quite well pleased with the situation and it looked as though they would have valuable properties to develop. Beren solicited Sparks’ business and was told by Sparks “he saw no reason why plaintiff shouldn’t sell them some material.” Upon furnishing a credit reference to Beren, Sparks advised that “Rathbun was to do the day-to-day buying in the area.” *1059 During the conversation Sparks requested that a copy of the invoices charged to the account be sent to him.

In March and June two other telephone conversations took place between Beren and Sparks relating to payments on the account. In each instance Sparks assured Beren he would attend to the matter. In these telephone conversations no mention was made of any specific leases; they were referred to as operations on leases in Bartlesville area. Rathbun, upon one occasion, introduced Sparks to one of inter-venors as his partner.

The plaintiff in error Sparks contends that the trial court erred in finding a mining partnership to exist as between Sparks and Rathbun as to all of the seven leases, and cites as authority White v. A. C. Houston Lumber Company, 179 Okl. 89, 64 P.2d 908, wherein it was held that there should be a joint interest in the property, agreements express or implied, to share in the profits and losses of the venture, and actions and conduct showing co-operation in the project. It is his contention that the evidence is insufficient to establish the presence of all the above requirements.

It is a well-established rule of this court that where an action of legal cognizance is tried without a jury, judgment will be given same effect as verdict of properly instructed jury, and same will not be reversed if there is any evidence reasonably supporting the judgment. Continental Supply Co. v. Dickson Oil Co., 194 Okl. 660, 153 P.2d 1017.

In the case of McKay v. Kelly, 130 Okl. 62, 264 P. 814, we held:

“A mining partnership is not based upon any agreement, either express or implied, but arises from the relation of the parties independent of a purpose to form a partnership when two or more cotenants unite and co-operate in the development and operation of a mine or a mining claim by each one paying his proportionate part of the expenses and receiving his proportionate part of the profits or bearing his proportionate part of the losses.”

In the case of Robinson Petroleum Co. v. Black, Sivalls & Bryon, Inc., 138 Okl. 128, 280 P. 593, 595, this court held:

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Bluebook (online)
1959 OK 73, 339 P.2d 1056, 10 Oil & Gas Rep. 984, 1959 Okla. LEXIS 441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sparks-v-midland-supply-company-okla-1959.