Woolley v. Simpson

1939 OK 52, 90 P.2d 943, 185 Okla. 224, 1939 Okla. LEXIS 304
CourtSupreme Court of Oklahoma
DecidedJanuary 24, 1939
DocketNo. 27895.
StatusPublished
Cited by1 cases

This text of 1939 OK 52 (Woolley v. Simpson) 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
Woolley v. Simpson, 1939 OK 52, 90 P.2d 943, 185 Okla. 224, 1939 Okla. LEXIS 304 (Okla. 1939).

Opinion

HURST, J.

This is an action to cancel certain oil and gas conveyances on the ground of fraud in their procurement. The plaintiffs, W. W. Woolley and Lillie B. Woolley, husband and wife, were the owners of a 385-acre tract of land in the vicinity of the “Eitts” oil pool in Pontotoc county. They sued R. W. Simpson, L. H. Harrell, W. B. Osborn and his wife, Jewell Hope Osborn, and also the Amerada Petroleum Corporation, on the ground that by fraudulent misrepresentation they had been induced to convey an undivided one-half interest of the “royalty” under a 250-acre tract, another undivided one-half interest of the “royalty” under a 60-aere tract, and an oil and gas lease covering another 140-acre tract. At the commencement of the trial, upon opening statement of counsel, their action was dismissed as to defendants L. H. Harrell and the Amerada Petroleum Corporation. The trial proceeded against Simpson, Osborn, and Osborn’s wife. At the close of all the evidence, the trial court made findings of fact and conclusions of law and rendered judgment in favor of the defendants. The plaintiffs bring this appeal.

The record discloses the following facts: Osborn was the president of the Fleetborn Oil Company. He called Simpson to his office and asked if he would undertake to purchase a lease and royalty from the Wool-leys and authorized Simpson to pay $14,000 for a 140-acre lease and a half interest in 250 acres of royalty. On July 18, 1934, Simpson went to Woolley’s home and ascertained from them that their property was encumbered by a mortgage in the approximate sum of $17,000, and that plaintiffs wanted to sell a lease and enough royalty to pay the mortgage, and no more.

Plaintiffs testified that when they asked who was going to buy the acreage, Simpson told them it was “a major company, one which had not been in that field prior to that time”, and that they then asked if it was the Fleetborn Oil Company, to which Simpson replied it was not. Simpson, however, denied that he made such statement, and testified that he told them the purchaser was to be a “responsible company”, and that he had in mind the Fleetborn Oil Company, but told plaintiffs that he was not permitted to disclose the name. It appears from plaintiffs’ testimony that their reason for inquiring about the purchaser was to insure development, and they admitted that the Fleetborn Oil Company, which was at that time operating a well on their premises, “has developed all right”, and “so far as I know they are a major company”.

Simpson reported back to Osborn, and Osborn raised his offer to $15,000, and on July 19th Simpson again approached the plaintiffs, and, after discussing the mortgage, Simpson advised plaintiffs that he thought Osborn would pay $17,000 for certain acreage which he proceeded to mark out on a map. When he came to the royalty under the 60-acre tract, plaintiffs objected, but Simpson said that is what it would take, so plaintiffs told him “if it would take that to make up the loan, I guessed it would have to go”. Upon being asked what Simpson was getting out of the deal, he said a 5 per cent, commission. It also appears that Simpson told plaintiffs that “Mr. Osborn will pay for this”. The deal was not then consummated, but Simpson left with the understanding that if plaintiffs agreed, he was to come back. Simpson reported to Osborn and he agreed to pay $17,000 only if they included the royalty under the 60-acre tract, and they could “take it or leave it”. That evening and early the next morning plaintiffs called two of their friends, Mr. Kitchel and Mr. Sledge, both experienced oil men and who were acquainted with the property in that vicinity, and they came the next day, July 20th, a few minutes before Simpson arrived. Simpson brought three instruments : a mineral deed covering an undivided one-half interest in the 250-acre tract made out to Osborn as grantee, another mineral deed covering an undivided one-half interest in the 60-acre tract made out to Simpson as grantee, and an oil and gas lease covering *226 the 140-acre tract made out to L. H. Harrell, Osborn’s attorney. After Mr. Sledge bad ascertained that the mortgage company would accept $16,000 in full payment of the loan, and after some conversation, plaintiffs examined the instruments and executed them. Subsequently, after a settlement had been made with another party who held an option to sell the mineral interests in said land, plaintiffs’ mortgagee received $16,000 and plaintiffs received $1,000 by cheek from Osborn. Simpson received a commission of approximately $800.

It appears that during the conversation on July 20th, both Kitehel and Sledge advised plaintiffs to make the deal. Plaintiffs consulted with these men out of the presence of Simpson, and plaintiff, Mr. Wool-ley, admitted that he did not take Simpson’s word for it, but advised with his two friends. He stated that it was “somewhat” on Kit-chel’s advice that he made the deal. Plaintiff, Mrs. Woolley, testified that “I told Mr. Simpson when he was there I wouldn’t sell, or sign any papers, without talking to some one we felt was really our friend. He said, ‘fine’ ”. She further testified that she said: “Mr. Kitehel, I have always had a lot of confidence in you”, and further, “I want you to advise me just like you would a sister”.

Defendant Osborn testified that at the time the deal was made he was dealing for the Eleetborn Oil Company, but between 48 and 72 hours later he started dealing with the Amerada Petroleum Corporation, with the result that he sold them the royalty interest taken in his name and the lease taken in his attorney’s name for the sum of approximately $19,006. Assignments were made on July 23rd, and Osborn received a commission of approximately $900. These instruments were not recorded until about August 14, 1934. He testified that “my reason for not keeping it for Eleetborn was we got afraid of it and I sold all the royalty and the lease, except this 30 acres”.

All the defendants testified that neither Harrell nor Simpson acquired any interest in the property by the instruments taken in their name, hut the instruments were so taken upon- advice of counsel and in order to prevent a merger of estates and “keep a merchantable title.” However, on November 13th, Simpson conveyed to Osborn’s wife a half interest in the royalty under the 60-acre tract, leaving the other half interest in Simpson, in consideration, so both Simpson and Osborn testified, of the satisfaction of a debt owed by Osborn to Simi>son arising out of other matters.

It appears from the record that plaintiffs learned “some few weeks or several days” after the recording of the instruments to the Amerada on August 14th, that the interest in the 60-acre royalty had not also been conveyed. But the record also shows that “a week and a half or two weeks” after the deal was made on July 20th, plaintiffs became dissatisfied and, according to Mr. Woolley’s testimony: “I was dissatisfied. I hadn’t been able to look after my interest and there was an immediate boom.” Mrs. Woolley was asked this question: “If you did not know it had not all gone to a major company, this 30 acres (one-half interest in the 60-acre royalty) the well was on, why were you mad before you found out about that?” Answer: “The values had increased, of course. We found out later about the well on the field and we felt these men knew about that and bought this lease and we did not learn about it until afterwards.”

1. There is no serious controversy between the parties as to the law applicable to this case. Both parties refer to the rule stated in Wingate v.

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Bluebook (online)
1939 OK 52, 90 P.2d 943, 185 Okla. 224, 1939 Okla. LEXIS 304, Counsel Stack Legal Research, https://law.counselstack.com/opinion/woolley-v-simpson-okla-1939.