Case ID: sw2d_450/html/0703-01.html
Source: Caselaw Access Project
Author: {"author": "SHARPE, Justice.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Sidney P. CHANDLER, Appellant, v. John W. HERNDON d/b/a Gulf Sands Oil & Gas Company, Appellee.
    No. 508.
    Court of Civil Appeals of Texas, Corpus Christi.
    Jan. 8, 1970.
    Rehearing Denied Feb. 26, 1970.
    Sidney P. Chandler, Corpus Christi, for appellant.
    Horkin, Nicolas & Nicolas, Toufic Nicolas, Ralph J. Graham, Corpus Christi, for appellee.
   OPINION

SHARPE, Justice.

Plaintiff-appellant sued defendant-appel-lee for $1,122.50 alleging that in the year 1967 the parties entered into a joint adventure agreement for the re-working of a gas well which proved unsuccessful and that plaintiff was entitled to recover said amount as his share of unexpended funds.

After non-jury trial plaintiff was denied recovery except for $112.00, representing one eighth (⅛) of the value of property still on hand after operations ceased. The award of $112.00 is not involved in this appeal. The trial court concluded that there was no joint adventure between the parties and recited that holding in the judgment. No other findings or conclusions were requested or filed.

Plaintiff asserts three points of error. The controlling question is whether there was a joint adventure between the parties in connection with the said well re-working operations.

The evidence consists of the testimony of defendant, John W. Herndon, and several exhibits. The written agreement primarily relied on by plaintiff reads as lows:

The defendant’s position is largely shown by his letter of December 27, 1968, offered in evidence by plaintiff, reading as follows:

The testimony of defendant when considered along with the exhibits is legally sufficient to establish the following facts. Defendant was the owner of a 75% working interest in an oil and gas lease on a tract of land near Odem, San Patricio County, Texas, which lease had been obtained from Alice National Bank, Alice, Texas. The plaintiff purchased an undivided one-eighth (i/$) of such working interest for $1500.00. Defendant agreed to undertake the re-working of the well “in an attempt to re-establish commercial production of gas.” The attempt failed and the lease was lost. Defendant sold % of the working interest to other parties, including a 1/8 interest to plaintiff, at a net of $1000.00 per ⅛ to him, the balance of the sales price being paid as commissions. In plaintiff’s case, the amount of $500.00 was paid to Mr. Joe Neel as commission, leaving $1000.00 net to defendant from the amount paid by plaintiff. Defendant spent about $4000.00 on the re-working operations. Plaintiff’s Y& share of the salvage value of property on the lease was about $112.00.

We agree with appellee that the evidence-supported implied findings of fact support the judgment and that the conclusion of the trial court that there was no joint adventure between plaintiff and defendant is correct.

The essential elements of a joint adventure are (1) mutual right of control, (2) community of interest, (3) agreement to share profits as principals, and (4) agreement to share losses, costs or expenses. See Brown v. Cole, 155 Tex. 624, 291 S.W.2d 704 (1956), 59 A.L.R.2d 1011 (1956); Luling Oil & Gas Co. v. Humble Oil & Refining Co., 144 Tex. 475, 191 S.W.2d 716 (1946); Price v. Wrather, 443 S.W.2d 348 (Tex.Civ.App., Dallas, 1969, wr. ref., n. r. e.); North Texas Lumber Company v. Kaspar, 415 S.W.2d 470 (Tex.Civ.App., Dallas, 1967, wr. ref. n. r. e.); C. C. Roddy, Inc. v. Carlisle, 391 S.W.2d 765 (Tex.Civ.App., Ft. Worth, 1965, wr. ref., n. r. e.).

Here there was no mutual right of control. The defendant alone had control under express provision of the written agreement relied on by plaintiff, and plaintiff’s petition contains an allegation to such effect. The issue of mutual right of control is therefore established against plaintiff by both his pleadings and the evidence. Nor was there community of interest. There was nothing to prohibit plaintiff from holding or selling his undivided interest in the property involved independently of the defendant. It also appears that there was no agreement to share losses, costs or expenses. One portion of the written agreement relied on by plaintiff provides that “this sale and transfer is expressly made subject to all the terms, conditions and provisions of the above-mentioned assignment of oil, gas and mineral lease and the terms of the lease involved.” The assignment and lease are not in evidence and we therefore cannot determine what effect they might have on the items of losses, costs or expenses. The testimony of defendant, which was not controverted by plaintiff, was in substance that defendant agreed with plaintiff that the latter would not have any additional obligations on the completion cost of re-working the well. The trial court was authorized to accept the defendant’s testimony in such respect and to hold that there was no agreement to share losses, costs or expenses.

Since it appears that three of the essential elements of a joint adventure are lacking in this case, we need not decide whether there was an agreement to share profits as principals. The conclusion of the trial court that there was no joint adventure herein must be upheld.

On the record here presented it appears that plaintiff was no more than an owner of a ⅛ undivided interest in the above-described working interest in the lease and as such was not entitled to a recovery additional to that awarded him by the trial court. Appellant’s points are overruled.

The judgment of the trial court is affirmed.