Zeigler v. Brenneman

Mr. Justice Scott

delivered the opinion of the court:

George Zeigler and Martha V. Zeigler, his first wife, owned each an undivided one-half of the real estate covered by the oil and gas leases here involved, as tenants in common. Upon the death of the wife, intestate, her title in the land passed to their three children, burdened with the dower right of the husband. At the time of the execution of the Seybert lease George Zeigler was, as he had been for many years, in the sole possession of the real estate, claiming and apparently believing himself to be the holder of the entire title. The heirs of Martha V. seem to have shared his belief as to the condition of the title. After the lease had been assigned to appellants, they, with the knowledge of the three children, operated the land for oil and developed a paying well. Up to that time the children made no objection to appellants’ proceedings but by their silence acquiesced in what was being done. Shortly after a paying well was brought in by appellants, however, the children served notice upon them to the effect that they owned an interest in the land and warned appellants to proceed nó further.

It is contended by appellants that these children, by their silence and acquiescence while appellants expended large sums of money and demonstrated the great value of the property, are estopped to assert, as against the appellants, their title to the premises or to object to appellants oper-.. ating the land for oil. There is evidence which tends to: show, and the court found, that these children were ignorant of the fact that they owned any interest in this land until after appellants’ well was brought in. With this finding of fact we are not disposed to interfere. Within a reasonable time after they so ascertained that they owned an interest in the land they gave notice to appellants. No estoppel arises against them, because during the time of their silence they were ignorant of the fact that they owned an interest in the land. Mullaney v. Duffy, 145 Ill. 5595 Bradley v. Lightcap, 202 id. 154.

The parties to this litigation agree that one tenant in common may not operate for oil against the protest or without the consent of the other tenants in common. Appellants contend, however, that the lease from George Zeigler to Seybert was binding, as between the parties thereto, so far as the interest of George Zeigler in the oil and gas was concerned, while appellees’ position is that the Seybert lease, having been made by one tenant in common without the other tenants in common joining therein, is wholly and entirely void so long as the lands remain undivided, and that during that time the owners of the land, including the lessor of appellants, may have the land operated for oil and enjoy the profits precisely as though the Seybert lease had never been made, but that in the event of a partition of the land, then the Seybert lease will become operative and give to the holder thereof the sole right to operate for oil the portion of the real estate set off to George Zeigler.

Appellees by their brief quote and rely upon section 198 of Freeman on Co-tenancy, which in our judgment states the law correctly, in these words: “A conveyance of' the minerals in a tract of land, reserving his interest in the land itself, made by a co-tenant to a stranger, is regarded as void as against the co-tenants of the grantor, ‘because it is an attempt to create a new and distinct tenancy in common between one co-tenant and the others in distinct parts of the common estate, which is contrary to the rules of law.’ ”

The lease is void as against the grantor’s co-tenants,— that is to say, in determining their rights in the property ño consideration is to be given to the existence of that lease. But it does not follow therefrom that it is of no effect as between the lessor and the lessee, even while the premises remain undivided. On the contrary, as between them it is just as valid as a lease of property owned entirely by the lessor. (Freeman on Co-tenancy and Partition, sec. 253.) The law is that one tenant in common may not prejudice the rights of his co-tenants by a conveyance of any specific part, or of any interest, right or license in any specific part, of the common property, but such a conveyance is valid as against the grantor, at least by way of estoppel. It is only where, and as far as, it comes in conflict with the interests of the co-tenants that it is void. (Fredrick v. Fredrick, 219 Ill. 568; Finch v. Green, 225 id. 304.) In the present case, after the execution of the lease to Seybert, he and George Zeigler together held and possessed all the privileges, right, title and interest in the land, including the oil and gas, that George Zeigler had before possessed, and the. rights of George Zeigler’s co-tenants remained precisely as they were before that lease was made. For example, if there was a partition of the land, then the Seybert lease would follow the interest of George Zeigler and be operative only upon the land set off to him, but as between George Zeigler and Seybert the latter had the same right in reference to operating the land for oil and gas that George Zeigler had prior to the execution of the lease, subject only to such burdens as were imposed upon Seybert by that instrument. It follows, therefore, that nothing was conveyed to Rapp by George Zeigler when he joined in the lease which Rapp took. Rapp has no greater right than if his lease was alone with the children of Martha V. Zeigler, the Seybert lease having been recorded and operations having been in. full swing on the land under that instrument when Rapp took his lease. Neither of the lessees' can maintain partition, (Watford Oil and Gas Co. v. Shipman, 233 Ill. 9,) and neither of them has the right to operate without the consent of the other, (Murray v. Haverty, 70 Ill. 318,) but either of the lessors can maintain partition, and in that way give to his lessee the sole right to operate for oil and gas in the portion of the land which may be set off to such lessor. If appellants and Rapp can agree upon the method by which this land" shall be” operated then they may operate it, one-half of the oil going to [Rapp, out of which he shall pay to each of the children of Martha V. Zeigler one-eighteenth part of that half as rent or royalty, the other half of the oil going to appellants, out of which they shall pay one-eighth part of that half to George Zeigler as rent or royalty. If, however, appellants and Rapp cannot so agree, neither can rightfully operate the land for oil unless some one of the tenants in common elect to have the land partitioned, in which ■ event the rights of each lessee will attach to the land set off to his lessor or lessors. It is true that this view requires the children of Martha V. Zeigler or their lessee to agree upon the operation of the land for oil and gas, in case they so desire to operate while the land remains undivided, with appellants instead of with George Zeigler; but in law this is not to be regarded as prejudicial to their interests, as it cannot be said that George Zeigler’s lessees will be less ready to join with the children or their lessee in operating the land than would George Zeigler himself.

No question respecting the dower right of George Zeigler has been presented by the parties.

The decree herein must be reversed and the cause remanded to the circuit court. Upon the cause being re-docketed the court will enter a decree providing that the lease from George Zeigler to Seybert, and its assignments, shall be canceled and set aside and for naught held in so far as they appear to convey any right, privilege or license in and to the interest in the real estate which Martha V. Zeigler’s children inherited from her, but leaving that lease and its assignments in full force and effect so far as they purport to convey any right, privilege or license with respect to the interest of George Zeigler in the real estate. The decree shall also provide for the division of the oil already produced, or its proceeds, in the manner following: The oil produced before June 25, 1907, (which was the date of the first lease made to Rapp,) or its proceeds, shall be divided, without any charge for production, in the manner following: The one-sixteenth to George Zeigler, the seven-sixteenths to appellants, and to each of the three children of Martha V. Zeigler the one-sixth part. All the oil produced on and after June 25, 1907, down to the time of the appointment of the receiver, or its proceeds, without any charge for production, shall be divided in the manner following: To George Zeigler the three forty-eighths, to appellants the twenty-one forty-eighths, to each of the three children of Martha V. Zeigler the one thirty-sixth, and to Rapp the twenty forty-eighths part. The oil produced since the time of the appointment of the receiver, or its proceeds, after his disbursements and charges have been provided for out of the oil so produced, shall be divided in the same manner as the oil above mentioned which was produced on and after June 25, 1907, down to the time of the receiver’s appointment. For the purpose of effecting such division of the oil, or its proceeds, as is hereby awarded, the decree shall provide for any party hereto accounting and making payment to any other party hereto as may be necessary. If desirable for the purpose of effecting such division, additional proof may be taken, either in open court or upon a reference to a master. The costs of the circuit court other than the charges and disbursements of the receiver shall be adjudged one-half against the complainants and one-half against the defendants. The receiver shall be discharged and the cause shall be, stricken from the docket.

Reversed and remanded, with directions.