Warner v. Nordan & Morris

158 S.W.2d 850
CourtCourt of Appeals of Texas
DecidedJanuary 21, 1942
DocketNo. 11076.
StatusPublished
Cited by1 cases

This text of 158 S.W.2d 850 (Warner v. Nordan & Morris) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Warner v. Nordan & Morris, 158 S.W.2d 850 (Tex. Ct. App. 1942).

Opinion

MURRAY, Justice.

Prior to February 2, 1937, Thor Warner was the owner of oil, gas and mineral leases covering six tracts of land located in Zapata County, Texas. Under these leases Warner was the owner of a seven-eighths interest of the oil, gas and mineral in, on and under these tracts.

On the date above stated, Thor Warner as owner and Wm. H. Winn as operator entered into a contract and agreement whereby Warner conveyed to Winn a two-thirds interest in these leases, in consideration of Winn’s developing and operating the leases insofar as the gas interest was concerned. Winn agreed to drill four gas wells under certain conditions. It was agreed that Winn was ultimately to be reimbursed for the expenses of drilling and operating these wells in the following manner: “The net profits derived from any wells completed on such premises owned jointly by the parties hereto under this agreement, after first deducting the expenses in connection with the maintenance and operation thereof and of the leasehold premises other than the costs of drilling and completing the first four wells, shall be divided between the owner and the operator in the proportion of 3/4 to operator, and 1/4 to owner, until the costs and expenses of drilling and completing any or all of said first four wells, as herein provided, shall have been returned to operator, and after operator has been repaid for all of the said wells drilled up to four, at his own cost and expense, under the terms hereof, such net profits shall be divided so that operator shall receive 2/3 thereof and owner 1/3.”

On March 17, 1937, W. H. Winn and Thor Warner, as sellers, and Nordan and Morris, a partnership, as buyers, entered into a “Gas Purchase Contract” containing, among others, the following covenant and stipulation:

Sellers (Wm. H. Winn and Thor Warner) here designate their respective interests in the gas covered by this Contract to be as follows, and do hereby and herein authorize Buyer (Nordan and Morris) to make settlement direct for the respective interest here shown:

“Wm. H. Winn 3/4th of 7/8ths and Thor Warner l/4th of 7/8ths until Winn shall have received approximately $23,000.00 from his (3/4thsof 7/8ths) interest.

“After Winn has received approximately $23,000.00 as hereinabove provided, then *852 and from that time the division of interest shall he:

“Wm. H. Winn — 2/3rd of 7/8ths, and TIior Warner — l/3rd of 7/8ths.”

On February 15, 1938, another “Gas Purchase Contract” was entered into by the same parties, containing' a similar provision. The only difference in these contracts being that they covered different tracts of land in Zapata County.

On January 15, 1940, C. M. Gaines, as attorney for Wm. H. Winn, wrote the following letter to Nordan and Morris, to-wit:

“Messrs. Nordan & Morris
“Milam Building
“San Antonio, Texas “Gentlemen:
“In regard to the leases in the Lopena field in Zapata County, Texas, operated by Mr. Wm. H. Winn, from which you have been purchasing the gas production and remitting to Mr. Winn and to Mr. Warner, Mr. Winn has, under his agreement with Mr. Warner, a lien against all of the interest of Mr. Warner to secure the repayment of any monies due to Mr. Winn, and there is now due and unpaid by Mr. Warner to Mr. Winn in excess of $3,000.00 so secured.
“This lien exists against the gas previously sold and delivered to you but no claim is asserted against you for that part paid for in the past but Mr. Winn is asserting his lien to all not heretofore paid for and will find it necessary to follow the proceeds of the sale of Mr. Warner’s interest unless, of course, a settlement. is made, and this is to advise you of this lien and the claim of Mr. Winn as above stated.
“Yours very truly,
“C. M. Gaines.”

When this letter was received, Nordan and Morris ceased making any payments direct to Warner for gas taken from the field, and on June 27, 1940, filed this suit in the nature of an interpleader and secured an interlocutory order directing them to pay the sum of $2,096.09 into the registry of the court, being the amount on hand due Warner under the gas purchase contracts. The order also directed Nordan and Morris to pay all future sums due Warner under said gas purchase contracts into the registry of the Court.

Wm. H. Winn answered setting up his claims against Warner, and Thor Warner answered defending against the claims of Winn. The trial began to a jury but resulted in an instructed verdict and judgment based thereon.

The judgment decreed a recovery by Winn against Warner in the sum of $2,858.-91, together with interest from February 17, 1941, at 6% per annum. The clerk was directed to pay Winn this sum out of funds accumulated in his hands, and to pay to Warner the balance on hand after satisfying the judgment in Winn’s favor.

Nordan and Morris were allowed to recover the sum of $250 as attorney’s fees and all court costs to be paid equally by Winn and Warner.

It is further decreed that there is a balance due Winn for drilling and completion of three wells as of January 1, 1941, of $9,843.94, arid that Winn is entitled to receive three-fourths of the net profits of the gas derived by Warner and Winn from any wells completed on the said premises after first deducting the expenses from and after January' 15, 1941, incurred in connection with the maintenance and operation thereof and of the leasehold premises, until the said Winn shall have received the said sum of $9,843.94.

From this judgment Warner has prosecuted this appeal.

Appellant first contends that appel-lees Nordan and Morris should not have been permitted to interplead in this case, but should have been held to be parties to the suit. This contention involves the attorney’s fees which Nordan and Morris were permitted to recover, $125 of which was adjudged against Warner, and also the court costs adjudged against Warner, that is one-half of the costs of interpleader, and, further, the failure of the court to charge Nor-dan and Morris with legal interest during the time funds were held in their hands.

Appellant contends that interpleader did not lie as a matter of law, because Winn’s claim was not to a specific fund or thing, but merely an alleged indebtedness to him by Warner. We overrule this contention. Winn did not assert any claim on funds previously paid to Warner by Nordan and Morris, but simply as to payments then due or that might become due to him in the future. The money due Warner was for gas taken from the leasehold, of which Winn owned , two-thirds and had a lien against the one-third owned by Warner to secure him for money advanced incident to maintaining and operating the gas wells. Winn had a *853 right under the contract between himself and Warner to have this money deducted before Warner was paid his one-fourth interest. Under such circumstances, Winn’s claim was to a specific fund such as is contemplated in interpleader proceedings.

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Bluebook (online)
158 S.W.2d 850, Counsel Stack Legal Research, https://law.counselstack.com/opinion/warner-v-nordan-morris-texapp-1942.