Thibodeaux v. American Land & Exploration, Inc.

450 So. 2d 990, 81 Oil & Gas Rep. 291, 1984 La. App. LEXIS 8713
CourtLouisiana Court of Appeal
DecidedMay 16, 1984
Docket83-681
StatusPublished
Cited by4 cases

This text of 450 So. 2d 990 (Thibodeaux v. American Land & Exploration, Inc.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thibodeaux v. American Land & Exploration, Inc., 450 So. 2d 990, 81 Oil & Gas Rep. 291, 1984 La. App. LEXIS 8713 (La. Ct. App. 1984).

Opinion

450 So.2d 990 (1984)

Dallas J. THIBODEAUX, Plaintiff-Appellee,
v.
AMERICAN LAND & EXPLORATION, INC., et al., Defendants-Appellants.

No. 83-681.

Court of Appeal of Louisiana, Third Circuit.

May 16, 1984.
Rehearing Denied June 14, 1984.

Aaron, Aaron & Chambers, Noble M. Chambers, Jr., Crowley, for defendants-appellants.

Privat & Regan, Kenneth O. Privat, Crowley, for plaintiff-appellee.

Before CUTRER, STOKER and KNOLL, JJ.

CUTRER, Judge.

This appeal emanates from a trial court judgment rescinding a royalty deed confected by Dallas J. Thibodeaux, vendor, and American Land & Exploration, Inc., vendee, (American Land).[1] Thibodeaux filed suit to rescind a royalty deed purporting to transfer one-half of his royalty interest in certain lands. Thibodeaux seeks rescission on the ground of fraud or error. From a trial court judgment annulling the royalty deed American Land appealed. We reverse.

FACTS

The facts are generally undisputed. We shall detail Thibodeaux's dealings with his *991 royalty and mineral interests in the subject property to show that Thibodeaux had negotiated several transactions which included transfers of fractional interests and "royalty acre" interests. These activities reflect that Thibodeaux had at least a working knowledge of the term "royalty acre" and the use of fractional interests in transferring his royalty or mineral interests.

Thibodeaux is the owner of an undivided one-half interest in three tracts of land, totaling 29½ acres, located in Acadia Parish.[2] His children own the other undivided share. This ownership structure appears to be the result of the earlier death of plaintiff's wife and the classification of the three tracts as having been community property.

In 1980, Thibodeaux executed a mineral lease of the land to Stone Oil Corporation (Stone Oil), reserving a one-fifth royalty interest in the oil, gas and other minerals. On January 29, 1982, Stone Oil and Thibodeaux executed a second mineral lease, assuming that the first lease had expired. This second lease also reserved one-fifth of the minerals as royalty for the owner/lessor. On that same day, Thibodeaux signed a royalty deed conveying to Stone Oil 3/80 of the minerals over the three tracts of land. Plaintiff was paid $18,000.00 by Stone Oil for this conveyance.

After Thibodeaux filed the suit in question, Stone Oil intervened to protect its royalty interest which it had purchased from Thibodeaux. A compromise settlement was reached in December 1982 between Stone Oil and Thibodeaux and Stone Oil was dismissed from this suit. The compromise settlement set aside the second lease and left the 1980 lease in effect.

It also provided that Stone Oil would be given an option to purchase one-half of the mineral royalty interest owned by Thibodeaux for a consideration of $2,000.00 per royalty acre in the event that Thibodeaux would prevail in this suit against American Land.

In early January 1982, Thibodeaux was approached by a man named Lambert from Lafayette who sought to purchase a portion of Thibodeaux's royalty interest at the rate of $700.00 per royalty acre. When Thibodeaux rejected that offer, Lambert promptly raised his offer to $1,500.00 per royalty acre. Told that this, too, was inadequate, Lambert left and did not contact Thibodeaux again.

In late February 1982, Timothy Supple (the president and sole stockholder of American Land) telephoned Thibodeaux and inquired whether he could purchase some of Thibodeaux's royalty interests. According to Supple, his first offer was rejected by Thibodeaux. Supple testified that he agreed to pay Thibodeaux the same rate agreed to by Stone Oil. Supple stated that Thibodeaux told him that the price was $3,000.00 per royalty acre.[3]

Supple testified that Thibodeaux agreed to sell him one-fourth of his interest (5.9 royalty acres) for $3,000.00 per royalty acre, or a total of $18,000.00. Supple also asked Thibodeaux to inquire of his children if they would sell that same amount. Approximately one week later, Supple again called Thibodeaux and was told that the latter's children were unwilling to sell any more of their interests. Supple then asked Thibodeaux if he would be willing to sell *992 another one-fourth of his share. Supple agreed to pay Thibodeaux $36,000.00 for the two one-fourth interests, equalling one-half of Thibodeaux's holdings. Supple stated that the $36,000.00 figure was reached by multiplying the royalty acres, approximately twelve, by the rate of $3,000.00. Supple stated that Thibodeaux agreed to sell one-half of his one-half interest for the $36,000.00, but the terminology they primarily used in their conversations referred to royalty acres because Thibodeaux preferred to deal in this term. Supple agreed to meet Thibodeaux at his home in Rayne on Saturday, March 6, 1982, approximately three days after their conversation.

Supple accompanied by John K. Harrison, II, a landman who was to serve as a witness for the transaction, drove to Thibodeaux's home on March 6th to complete their sale. Prior to leaving his office for Rayne, Supple prepared both the royalty deed and the draft to Thibodeaux for $36,000.00. Upon arrival, Supple was told by Thibodeaux that an individual from New Orleans had made an offer of $4,500.00 per royalty acre for Thibodeaux's royalty interest.

Considering that Supple's firm offer was more secure than the one from New Orleans, Thibodeaux decided to accept American Land's offer. This decision was made after Supple had called his co-investor in New Orleans in an attempt to determine the identity of the other bidder and to see if Supple's co-investor would be willing to pay $4,500.00 per royalty acre. The unknown New Orleans bidder was tentatively identified as being Barry Doll. Supple told Thibodeaux that they could not match the offer of $4,500.00 per royalty acre for one-half of Thibodeaux's interest on the entire 29½ acres, but they might consider matching it for Thibodeaux's royal interest in the 20 acre tract. Thibodeaux then agreed to just go ahead with their original deed as planned rather than to depend upon the uncertainty of the New Orleans offer.

Shortly thereafter, the parties signed the royalty deed which had been earlier prepared by Supple. Thibodeaux was given a ten day sight draft in the amount of $36,000.00.[4] No one else was present but Harrison who acted as a witness. It is undisputed that the deed was read to Thibodeaux by Supple. The transferring language of that deed is as follows:

"* * * ONE-HALF (½) of the royalty of the oil, gas and other minerals, in and under and that may be produced from the following described lands situated in the Parish of Acadia, Louisiana:
[Description of three tracts of land-29½ acres.]
"IT IS UNDERSTOOD between the parties hereto that this sale is for ONE-HALF (½) of all the royalties owned, now or formerly, by DALLAS J. THIBODEAUX, but in no event shall the royalties conveyed herein equal less that 11.8 royalties acres." (Emphasis added.)

Supple testified that the agreement was for one-half of Thibodeaux's one-half (one-fourth of the total) and that Thibodeaux stated that he did not need to talk to anyone prior to signing the deed. Further, Supple stated that they both knew what they were trading. Thibodeaux testified that he did not intend to transfer one-half of his interest but only intended to transfer one-fourth of same.

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Cite This Page — Counsel Stack

Bluebook (online)
450 So. 2d 990, 81 Oil & Gas Rep. 291, 1984 La. App. LEXIS 8713, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thibodeaux-v-american-land-exploration-inc-lactapp-1984.