Maier v. Continental Oil Co.

MAJOR, Circuit Judge

(concurring in result).

I concur in the result reached, as well as the reasons therefor. In addition, however, it is my opinion that the plaintiff is estopped to deny the validity of the lease in controversy. It would serve no useful pur*242pose to repeat the facts as stated in the opinion. It appears certain that there was a meeting of the minds, not only as to the purpose of the lease, but that it was to include all the lands owned by the plaintiff, located in Gibson County, Indiana.

Accepting the finding of the District Court that the corrected descriptions were placed in said lease without the knowledge and consent of plaintiff, yet the fact remains that she received a letter from Mc-Clurkin on September 30, 1937, advising that the descriptions had been altered and, as thus altered, were included in the lease. She also had knowledge that the lease, with the altered descriptions, was appropriately recorded on September 29, 1937. In November, 1937, pursuant to a contract theretofore made between McClurkin and the Continental Oil Company (defendant), the lease was assigned to the latter for a valuable consideration. The circumstances strongly indicate — in fact, the conclusion seems inescapable — -that plaintiff had knowledge of this assignment.

On June 6, 1938, defendant deposited an amount to plaintiff’s account in a bank for the purpose of continuing the lease in force for a further period of twelve months. The amount deposited was in conformity with the lease, and the depositary was the one designated therein. Plaintiff’s denial that she had knowledge of this deposit, under all the circumstances of the case, is not convincing, but whether she had actual knowledge or not, the bank was, by the terms of the lease, her agent, and she, at least, had constructive knowledge, and, in my opinion, is bound thereby.

Thus we have a situation where the plaintiff had knowledge of every material step taken in the execution and recording of the lease, as well as the payment of rental to continue it in force. She took no steps to question its validity until oil was discovered on December 14, 1938, in the neighborhood of the leased land, and a week later the instant suit was filed. It is apparent that it was only after plaintiff’s oil rights had become valuable by reason of the discovery of oil in the neighborhood, that she decided to attack the validity of the lease. In this connection it must be remembered that the defendant, as assignee of the lease, purchased the same in good faith for a valuable consideration and relied upon the record, which it had a right to do. There is nothing to indicate that it had any knowledge, or reason to believe, that plaintiff had any interest in the land included in the lease other than that disclosed by the record.

Under these circumstances, and others which might be related, it is my conclusion that a court of equity should not be utilized so as to enable plaintiff to cancel the instrument in controversy, in the hands of a third party, when she, by her acts and conduct, is largely, if not entirely, responsible for her asserted ■ predicament. Vincennes Savings & Loan Ass’n v. St. John, et al., 213 Ind. 171, 180, 12 N.E.2d 127; Dill v. Fraze, et al., 169 Ind. 53, 79 N.E. 971.