Town of Glenrock v. Abadie

259 P.2d 766, 71 Wyo. 414, 2 Oil & Gas Rep. 1441, 1953 Wyo. LEXIS 25

• Court: Wyoming Supreme Court
• Decided: July 14, 1953
• Docket: 2580
• Status: Published

Opinions

OPINION

Harnsberger, Justice.

On February 25, 1920, one Otto C. Engelking, as party of the first part, and Charles It. Skinner as party of the second part, signed an instrument in writing which provided, in part, as follows:

“That the party of the first part in consideration of the sum of Nine thousand Dollars to be paid as hereinafter set forth, the party of the first part agrees to sell and convey to the party of the second part, and by these presents does sell and convey to the party of the second part all of the surface right and an undivided one-half interest in all minerals, coal, oil gas, and minerals of every character, under and in and to the following described real estate to wit, * * * Lot Four (4) of Section Four (4) Township Thirty-three (33) North of Range Seventy-five (75) * * * west of the 6th P. M.,”

On the same day Engelking executed a warranty deed to Charles R. Skinner and Cora H. Skinner for the lands covered by the contract, but failed to make any reservation or exception of the mineral rights.

On March 29, 1920 the Skinners entered into the following agreement with the Town of Glenrock:

“WE, the undersigned hereby agree to sell to the Town of Glenrock for the amount of Five Thousand Dollars the following described piece of land:

“All that portion of our land bounded as follows: Beginning at the point of intersection of the right of way of the C. & N. W. Ry. Co. on the North side of their track, and the center of the main channel of Deer Creek; thence running down the center of Deer Creek as at present said channel exists to a point intersecting the division line between said land and what is known as the McDonald Corner; thence running East along said division line to the W. line of the Mrs. John Millar lane; thence running South to the N. line of the C. & N. W. Ry. Co. Right of way; and thence running West along said Right of way line to the point of beginning; subject however to an accurate survey (expense of which is to be borne equally between buyer and seller) and which is to be made as soon as possible.

“We hereby acknowledge receipt of Town Warrant No. 1983 for 8100.00 (One hundred dollars) as part payment on said land and hereby agree to deliver Warranty Deed to said land to the Town of Glenrock upon completion of said survey and subject to the following provision: That one-half (%) of the coal, oil and mineral rights on said land were reserved by Otto C. Engel-king and only our one-half (V2) of said mineral rights can bo deeded by us to said Town and this agreement will be made subject to our contract with Mr. Engel-king as regards future mineral leases or operations.

“Said piece of land contains thirty (30) acres more or less.”

The description of the tract to be sold under this “agreement” thus had for its East boundary line, the West line of the Mrs. John Millar lane and was to contain 30 acres more or less.

On April 15, 1920, the Skinners gave their deed to the Town of Glenrock for the lands, without, however, making any reservation or exception of mineral rights, and making the East boundary line of the tract, the East line of lot four (4) in section four (4), instead of the West line of the Mrs. John Millar lane. The deed also stated the area described contained twenty-five (25) acres more or less.

Notwithstanding their conveyance of the tract to the Town, the Skinners subsequently, and on October 4, 1920, gave their warranty deed to the said Otto C. Engelking, purporting to convey an undivided one-half mineral interest in the lands. Thereafter, and on June 6, 1921, the Town of Glenrock by its warranty deed conveyed back to the Skinners an undivided one-half mineral interest in the lands, and on June 9, 1949, the Town entered into an oil and gas lease covering the tract with the Phillips Petroleum Company. The Town then brought its suit to quiet title to the tract, pleading its ownership and also a title by adverse possession. Cora H. Skinner — who was joined as a defendant— contested the action and, by cross-petition, alleged herself to be the owner and in possession of an undivided one-half mineral interest in the lands concerned, pleaded mistakes in the Engelking-Skinner deed and in the Skinner-Town deed, and prayed that her title thereto be quieted.

Mrs. Skinner, while not specifically asking for reformation of the February 25, 1920 deed from Engelking to herself and husband or of the April 15, 1920 deed from her husband and herself to the Town of Glenrock —so as to make such deeds conform to the respective contracts pursuant to which they were given, nevertheless alleged that mistakes occurred in these deeds in that (1) they both failed'to make proper reservation to Otto C. Engelking of one-half of the mineral rights, and (2) that the deed of April 15, 1920, conveyed some four to five more acres than the parties intended. By cross-petition she also sought to establish and have quieted in herself the title to the undivided one-half mineral interest which she had received back from the Town of Glenrock by the deed of June 6, 1921. She also denied the possession of the Town and denied that the Town had acquired title by adverse possession.

The Town, in answer to this cross-petition, denied there was any mistake in the deed of April 15, 1920 by which it received conveyance from the Skinners; pleaded the Skinners had been guilty of laches and the running of the Statute of Limitations.

In reply to the charge of laches and the defense of limitations, Mrs. Skinner pleaded equitable estoppel against the Town, alleging she and her husband had been misled by and had relied upon representations and advice of the officials of the Town of Glenrock as to the effect of the contract and deed of February 25, 1920, and as to the effect of their deed of April 15,1920; that the Town and its officials had represented to the Skinners that as the Engelking interest was specifically mentioned and set out in the agreements of February 25, 1920 and March 29, 1920, the Engelking undivided one-half mineral interest would not — and did not — pass to the Town of Glenrock by virtue of the deed of April 15, 1920 given by Mr. and Mrs. Skinner.

The cross-petitioner also replied that the Town had also agreed that in consideration of the Skinners permitting the description in their deed of April 15, 1920 to remain as written, with the result that the Town of Glenrock would get more acreage than was contemplated by the agreement of March 29, 1920, the Town would — and did by its deed of June 6, 1921 — convey to the Skinners an undivided one-half interest in the minerals of the lands in question.

The case was tried to the court without a jury and a judgment was rendered, finding generally in favor of the defendant and cross-petitioner, Cora H. Skinner, and against the plaintiff, Town of Glenrock, Wyoming, and quieting Mrs. Skinner’s title to an undivided one-half interest in the oil, gas and other minerals of the lands in controversy.

The matter is brought to this court by the direct appeal of the plaintiff, Town of Glenrock, Wyoming.

The Town complains that the judgment is contrary to law, contrary to the preponderance of the evidence, that it erroneously reforms the deeds in question— although no reformation was prayed, and that such reformation was contrary to law, and the need therefore was not established by clear, substantial and convincing proof; also, that the court erred by failing to find the defendant, Cora H. Skinner, was guilty of gross laches, and in failing to hold that the claim of Cora H. Skinner was barred by the Statute of Limitations of this State.

The appellant contends that the February 25, 1920 deed from Engelking to Skinners conveyed both minerals and surface to the Skinners; that the deed of April 15, 1920, conveyed the whole of such interest to the Town of Glenrock; that the October 4, 1920 deed from Skinners to Engelking did not pass any title at the time it was given; that the June 6, 1921 deed from the Town to the Skinners was executed to give force and effect to the Skinners’ deed of October 4, 1920, and divested the Town of only one-half of the minerals it owned, and that such one-half interest immediately passed to Engelking by virtue of the warranty deed of October 4, 1920; that the Town, having received from Skinners all of the mineral interest and reconveying back to Skinners only one-half of such mineral interest, still retains the other one-half mineral interest in the land.

The gist of Mrs. Skinner’s contention is that she has never parted with the one-half mineral interest she received from the Town by its deed of June 6, 1921.

It may be admitted for the purpose of this case that the deed from Engelking to Skinner contained a mistake, and that is true also as to the deed dated April 15, 1920 from Skinners to the Town of Glen-rock. It may also be admitted for the purpose of this case that the deed of June 6, 1921 for a one-half interest in the minerals from the Town to the Skinners, was made in order to compensate the Skinners for some extra land not contemplated by the parties according to their contract, although to do so would require us to accept the improbable.

The contract between the Town and the Skinners called for thirty acres more or less. The land actually conveyed by deed was twenty-five acres. Mrs. Skinner contends that this deed conveyed five acres more than it should, so she would have us believe that the contract really contemplated only twenty acres— which would mean there was a mistake of thirty-three and one-third percent (33-1/3%. It is more than difficult to believe that the Town’s officials were so stupid or glaringly negligent as to pay $5,000 for a tract understood to approximate thirty acres when, in fact, the tract contained only twenty acres. This unlikelihood is further fortified by the witness, Kimball, a member of the Town’s council when the contract was made and who alone of all witnesses knew the actual facts, who testified that the Town was to get all of the Skinner land east of Deer Creek.

However, this case may be decided on undisputed facts.

It is not — and cannot be — disputed that the deed from the Skinners to the Town, dated April 15, 1920, conveyed all of the mineral interest in the land in controversy. It is also undisputed — and it cannot be successfully disputed — that the Town conveyed to the Skinners only one-half of the mineral interest by its deed of June 6, 1921, leaving the title of record to the other one-half mineral interest remaining in the Town where it has been unquestioned for over thirty years. It is also seemingly admitted by both parties that En-gelking owns one-half the mineral interest. Where did he get it? Engelking did not reserve it in his deed to the Skinners of February 25, 1920; the Town did not convey it to Engelking; therefore, any mineral interest Engelking now holds must be the interest he received by virtue of the Skinners’ deed of October 4, 1920. It cannot be anything else. True, the deed was made at a time when the Skinners had completely divested themselves of their whole title and before the Town’s deed of June 6, 1921 restored to them a one-half interest in the minerals, but whether the one preceded the .other cannot make any difference.

When the Skinners, by their warranty deed, conveyed to Engelking a one-half mineral interest, which they did not possess, and thereafter acquired such an interest, the after-acquired interest inured to the benefit of Engelking. It is said in 31 C.J.S. 203, Section 21, that — “ * * * The general rule is that, if a grantor of real estate having no title, a defective title, or an estate less than that which he assumed to grant, subsequently acquires the title or estate which he purported to convey, or perfects his title, such after-acquired or perfected title will inure to the grantee or to his benefit. * * * ”.

Hence, the Skinners parted with their one-half mineral interest received by the Town’s deed of June 6, 1921 as effectively as if the Town had conveyed that interest to the Skinners prior to the Skinners having conveyed the same to Engelking. In consequence, any contention that the Skinners never parted with the one-half mineral interest which they received by the Town’s deed of June 6, 1921 is without merit.

The situation in this case may be stated in another way. If it be true that the one-half mineral interest conveyed to the Skinners on June 6, 1921 is still the property of Mrs. Skinner, then either Engelking has no interest at all — which is contrary to the contention of both of the parties — or else the interest which is described in the then unauthorized deed of October 4, 1920 from the Skinners to Engelking is the one-half interest which the Town has never conveyed or parted with. This is, of course, contrary to the facts,

and contrary to the position taken by both parties.

As above stated, the Town has had the unquestioned and undisputed title to one-half of the mineral interest in question for over thirty years, and has never conveyed it either to Engelking, to Skinners, or to anyone else. How can it be deprived of that interest? Not by showing the conveyance of June 6, 1921, for the Town had the right to convey one-half of the. interest in what it then had, and it had the right to retain the other one-half, which it did. There is no possible way by which to deprive the Town of that one-half interest which it retained, except to attack the deed given by the Skinners to the Town on April 15, 1920, for one reason or another, and the only reason — if any — that exists in this case is by reason of a mistake in that it should, as claimed, have conveyed only one-half of the mineral interest. Such an action is an action to correct or reform a deed and is now, as hereafter shown, barred by the statute of limitations. Mrs. Skinner, in her cross-petition, pleaded the mistake, and asked for equitable relief. That cross-petition may be considered as sufficient for asking the reformation of a deed, although that specific relief was not asked.

Plaintiff claims by adverse possession. Counsel for Mrs. Skinner argue that there could be no adverse possession because the mineral and surface rights were severed, citing The Ohio Oil Company vs. Wyoming Agency, 63 Wyo. 187, 179 P. (2d) 773. The case is not in point. It would apply if the contest in this case were between the Town and Engelking. In the case at bar, the Town has had the record title to and the surface and one-half mineral interest for over thirty years. That one-half mineral interest, to which the Town had such record title, has never been severed, and the rule of adverse possession would seem to apply clearly where the right has been unquestioned for that period of time. We need not dwell on that point. The Town had the right to interpose the plea of limitations when the cross-petition for affirmative relief was filed by Mrs. Skinner. 53 C.J.S. 936, note 88; Sanders v. Sanders, 117 Cal. App. 231, 3 P. (2d) 599; Bradbury v. Higginson, 167 Cal. 553, 140 P. 254; Bryant v. Swetland et al, 48 Ohio St. 194. That plea was interposed in this case.

When courts of law and of equity were separate, the latter were not absolutely governed by any statute of limitations, although they generally applied a comparable time. Thus, it is said in 19 Am. Jur. 345, 346:

“ If the complainant has not offered any explanation of his delay in instituting suit and it appears that before he asserted his claim, he permitted the lapse of a period which is similar or comparable to one appearing in the provisions of the statute of limitations, relief will be denied. Courts of equity it is said, uniformly decline to assist a person who has slept upon his rights and show no excuse for his laches in asserting them. ”

But, under our statute, actions at law and suits in equity are blended, and we have but one form of action called a civil action. Section 3-301 Wyoming Compiled Statutes, 1945. Under such a statute, at least in many states, the statutes of limitation apply in all actions, whether formerly denominated at law or in equity. 21 C.J. 251, note 77; 30 C.J.S. 557, notes 16 & 17; Oakes v. Howell, 27 Howard’s Practice Rep. 145; Bryant v. Swetland et al, 48 Ohio St. 194, 206; Terry v. Davenport et al, 185 Ind. 561, 574, 112 N.E. 998. Thus, it is said in the Ohio case cited:

“ It is firmly settled in this state, that the statute of limitations applies to all civil actions, whether they be such as before the adoption of the code of civil procedure were called actions at law or suits in equity, except certain specified actions which the statute expressly exempts from its operation; * * * ” (48 Ohio St. 194, 206)

Our statute of limitations does not specifically apply to a case such as before us. It has, as is true in many other states, a so-called residuary clause (53 C.J.S. 1076, et seq.), in Section 3-509, Wyoming Compiled Statutes, 1945, reading as follows:

“ An action for relief, not hereinbefore provided for, can only be brought within ten years after the cause of action accrues. ”

Our statute was taken from Ohio, and it has been held that the statute quoted applies to an action for the reformation of an instrument. Bryant v. Swetland et al, 48 Ohio St. 194. And, it is stated in 53 C.J.S. 1076, 1078, that the residuary clause applies to actions ” * * * for the reformation of deeds and other instruments on the ground of mistake * * * ”. See also Morris Plan Bank v. Scott, 176 Tenn. 496. Further cases, holding that the statute of limitations applies to correction of mistakes in such instruments may be found in 1 Wood on Limitations (4th Ed.) pp. 299, 301; 53 C.J.S. 1069, note 8; 53 C.J.S. 1072, note 41. Under some statutes the action accrues when the mistake was made. Bryant v. Swetland et al, supra; Kithcart v. Metropolitan Life Ins. Co., 150 Fed. (2d) 997, citing Missouri cases; Barnes et al v. Barnes et al, 157 Tenn. 332, 8 S.W. (2d) 481. Under other statutes the cause of action accrues when the mistake is discovered. In Travis v. Glick, 150 Kan. 132 and 718, 91 P. (2d) 41, and 96 P. (2d) 624, it is. held that a person is deemed to have notice from the time that an instrument is recorded. A case of interest herein is Kennedy et al v. Brown, (Tex. Civ. App) 113 S.W. (2d) 1018, 1020, 1021. In that case, as. in this, a contract provided that a deed for certain property should reserve certain mineral interest. The deed, made pursuant to the contract, did not contain the reservation. An action brought nine years later sought reformation of the deed. The statute provided that an action for reformation by reason of mistake should be brought within four years after discovery of the mistake. The court held that action was brought too late, stating among other things:

“ * * * In the absence of circumstances which prevented him from reading it and informing himself of its contents, he was charged with knowledge of its provisions when he executed it, regardless of whether he read it or not. It was unquestionably his duty to read it and inform himself of its provisions, and if he failed in that respect, the law charges him with full knowledge and notice of its contents. Williams v. Rand et al., 9 Tex. Civ. App. 631, 30 S.W. 509; Womack v. Western Union Tel. Co., 58 Tex. 176, 44 Am. Rep. 614; Barclay v. Falvey et al., Tex Civ. App., 100 S.W. 2d 791; American Freehold Land Mortg. Co. v. Pace et al., 23 Tex. Civ. App. 222, 56 S. W. 377.

“ * * * Even if appellee were not charged by law with knowledge and notice of the contents of the deed and the absence therefrom of the reservation of the mineral rights which constitutes the mistake of which he complains, we think nine years extends far beyond the time that would be considered reasonable for a man of ordinary prudence to have discovered he had been deprived of valuable property rights by a deed which was at all times accessible to him, and we cannot accede to the contention of appellee that he would not be charged with some degree of diligence unless something happened that would have the effect of calling it to his attention.

“ * * * We perceive no reason why appellee should not have discovered the mistake in time to have had it corrected or brought his suit within the period of the limitation provided by the statute. The deed being of record in the public records of the county where the land was located and where appellee resided for several months after its execution, afforded him ample opportunity to read it and ascertain its provisions. We think it would be doing violence to the rule of reason if we should hold that a man of ordinary prudence who was looking after his property interests, as such a man would, is not charged with the duty of ascertaining a matter so vital and patent. * * * ” (113 S.W. (2d) 1018, 1020, 1021)

Certainly, the responsibility for the difficulty in which Mrs. Skinner finds herself rests solely with her and her deceased husband. They could have prevented any question from arising had they timely made correction of the failure of Engelking to reserve to himself his one-half mineral interest. It was the Skinners’ sole fault that they conveyed to the Town more than they intended. Being themselves responsible for the errors made, and having neglected for over thirty years to institute proceedings which would in all probability have given them relief, it is now too late to complain.

The Skinners knew that the records showed the Town to be the owner and possessed of the one-half mineral interest which is now claimed. Under that record title the Town had impliedly and constructively the possession of the one-half mineral interest which it had not alienated, for as is said in 42 Am. Jur. 220, Sec. 43:

“ The holder of a valid deed to real estate, whether it be a tax deed or a deed from the owner himself, impliedly and constructively has the possession of the property described in the deed * * ”

The respondent had knowledge of all the facts and circumstances bearing on the alleged mistakes. She had more than ample time and opportunity to establish her claim in.the courts. By reason of her lengthy delay, the Town was given every reason to believe that the Skinners either claimed no rights in the lands or had elected to abandon them and, it is apparent, that after all these years the condition and value of the property had materially changed due to the discovery of oil.

These facts parallel the conditions under which it is said in 19 Am. Jur. “Equity”, Sec. 498, p. 344, that it would be unjust to allow the assertion of such a claim:

“ The adjudicated cases ‘proceed on the assumption that the party to whom laches is imputed has knowledge of his rights, and an ample opportunity to establish them in the proper forum; that by reason of his delay the adverse party has good reason to believe that the alleged rights are worthless, or have been abandoned; and that, because of the change in condition of relations during this period of delay, it would be an injustice to the latter to permit him now to assert them. ’ ”

Further, there is no explanation or reason given by the respondent to excuse her omission to take action to establish her claim. The respondent did plead that certain representations had been made by the Town’s officials — including its attorney — which might have constituted an equitable estoppel to plead limitations on the theory that the Skinners were led to believe by the Town officials that the Town made no claim to the minerals, but the record does not contain any evidence whatsoever to support such plea, and no other excuse for the respondent’s negligence is offered.

In the case at bar, more than thirty years had elapsed since the mistake — if any — was made. If the correction may be made at this time, it might be made fifty or a hundred years from now. That cannot be the law. Some force must be given to the statutes of limitation.

For the reasons stated, the judgment must be reversed, and the cause remanded to the District Court with instruction to enter judgment quieting the plaintiff’s title to the surface and an undivided one-half interest in the minerals of the lands described in the deed of April 15, 1920 from Charles R. Skinner and Cora H. Skinner to the Town of Glenrock.

Reversed and remanded with instruction.

Blume, C. J., concurs