Court Opinion

ID: 3955055
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:16:29.843421+00
Date Added: 2024-06-11T07:43:37.640373
License: Public Domain

On Motion for Rehearing.
We have reviewed the authorities cited by counsel in their elaborate and able motion for rehearing, in which it is insisted that the testimony introduced shows conclusively that the instrument in controversy was a mortgage and not a conditional sale, as announced in the opinion of Justice MARTIN on original hearing.
Defendant Blake testified, in substance, that he borrowed from C. A. Everts $250 with which to finish a well he was then drilling and executed to Everts the instrument in controversy to secure its payment; that he did not execute a note for the sum borrowed and Everts told him he was lending the money as an accommodation, and that he (Blake) could repay it "just any time I got able to pay it." And with the further agreement that if the well then being drilled proved to be a producer, Everts would have the option to pay him $750 additional and retain title to the one-eighth royalty which the instrument purported to convey.
C. A. (Chet) Everts testified that plaintiff Blake told him he was in urgent need of $250 in order to spud in a well to save a forfeiture of his lease, "and he said, `I will tell you what I will do if you will let me have the $250.00 I will give you a one-eighth overriding royalty and I will give you that with the understanding if I make a well you pay me $750.00 more and if I don't make a well you don't owe me a cent,' and I said, `All right, I don't want to see you lose your deal'; and he came back later in the day and gave me an assignment to the overriding royalty as he had said and at the same time remarked that he could sell it for twice as much down in Dallas and that he was coming to Dallas the following Tuesday, and I said, `Well, I am going to go to California about Saturday, and if you can come to Dallas and sell it for twice that amount you can come down and do it and pick this up, you can do it if you get there by the time I go to California, but if you don't get there by the time that I go to California I will "ride" the whole matter' and he said, `I don't believe you realize that you have a bargain.'"
He further testified that he was not in the loan business; that Blake never offered to pay back the $250 until after witness had returned from California and the well had been finished, and never wrote him a letter in the meantime offering a return of the money before this suit was filed. He further testified that he went to California about one week after the instrument was executed, and while there was informed that Blake had spudded in the well on the 60-acre lease, of which the property in controversy was a part, and then directed Mr. Harris, his local representative, to file the assignment for record, and after his return from California he sold to his brother, C. T. Everts, *Page 1090 
plaintiff, the interest covered by the instrument. He further testified as follows:
"Q. Now, let's see, you were to get this assignment — and you were to pay $750.00 more if a commercial well was made — but you advanced him $250.00? A. Yes, he said that he needed it.
"Q. Well, did you require any security of him for the $250.00? A. No, not any other than the assignment which was an absolute assignment.
"Q. And your idea is that even though you had transferred this property out of your hands that you still owed him $750.00 if he made a producer, is that your idea of it? A. Yes, sir. I will explain it to you again; I bought the property for $250.00 with the understanding that there was to be $750.00 more paid if a producing well — and until it was a producing well I did not owe any more — and of course, by my transferring the assignment, that did not relieve me of the obligation — that was just a deal I had myself and I am ready to pay the $750.00."
Joe Art testified he was present in Everts' room in the Kemp Hotel when Blake applied to him for the $250.
"Q. Now, did you hear any conversation that day about Mr. Everts loaning Mr. Blake the $250.00? A. No, sir, he bought an interest.
"Q. Did you hear anything mentioned at all about an interest — did you hear anything at all about a loan? A. No.
"Q. State to the court, in the presence of Mr. Blake, if Chet did not offer to sell you a one-half interest in the interest that he was getting from Blake? A. I don't remember exactly. He might have — on several occasions Everts did offer me an interest, but I don't remember exactly if it was this one, or not."
Witness further testified that he was not interested in the controversy in any way.
John W. Harris, who was employed by C. A. Everts to look after his oil interests, testified that during the time Mr. Blake was drilling his well witness was frequently on the lease and met Blake.
"Q. Prior to January 1, 1935, did Mr. Blake ever discuss with you about Mr. C. A. Everts owing him anything? A. No.
"Q. I will ask you to state whether or not Mr. Blake stated to you that Mr. Everts owed him $750.00 when the well was completed? A. After he got a well Blake told me that he had $750.00 coming.
"Q. Did he ever ask you for it? A. Yes.
"Q. Why didn't you pay him? Did you have authority to pay him? A. No, sir, I did not.
"Q. Why didn't you get the money from Everts to pay him? A. As I understood it, if it was a commercial well, Everts was to give $750.00, and it was not determined whether it was a commercial well so far as I could find out.
"Q. Did you make any trips down there to see if it was a commercial well? A. Yes, sir, I did.
"Q. At whose instance did you make those trips? A. Mr. Everts.
"Q. Was it on the pump, or was there any oil being pumped when you were there? A. Not until several days ago there was not.
"Q. Even after that were you able to determine or tell whether it was a commercial well or not? A. No, sir."
"Since a conveyance cannot be a mortgage unless given to secure the performance of an obligation, the existence of an obligation to be secured is an essential element without which the mortgage instrument is but a shadow without substance." 19 R.C.L., § 68, p. 289.
If Blake was not indebted to Everts for the $250 after he executed the assignment to him, then there could be no proper basis for the claim that the assignment should be given effect as a mortgage under any of the authorities invoked by appellant. And in view of the testimony of Everts, corroborated by that of Art and Harris, and circumstances such as the absence of any written obligation of Blake to pay the $250 and the fact that the assignment was in terms an absolute conveyance of title, we believe it manifest that appellant's contention that the evidence showed conclusively that the assignment was in fact intended as a mortgage is without merit.
The motion for rehearing is overruled. *Page 1091