On Motion for Rehearing.
If appears from the 'statement of facts that the Alamo-Duke well was drilled under and by virtue of the lease executed by Mrs. N. O. Bearden, Mrs. Lizzie Queen, and the other Beardon heirs on the .56 acre, which was the disputed territory. That lease was executed after the execution of the first lease by Mrs. Lizzie Queen to L. C. Turman and the assignment by the latter to Sche-necker and Campbell, and after the conveyance by Mrs. Queen to F. B. King of a one-fóurth interest in the royalties on the 15-acre tract. On November 4, 1919, another division order, addressed to the Magnolia Petroleum Company and accepted by it, was executed by several of the Bearden heirs, stipulating that they were to receive certain interests in the royalty runs from the Alamo-Duke well. The acceptance of that division order would warrant the inference that the Magnolia Petroleum Company and the other parties to the instrument then believed that the .56 acre in dispute was not included in the Lizzie Queen tract, and that therefore the division order theretofore executed, and upon which this'suit was based, did not include oil- from the Alamo-Duke well. It is earnestly insisted that the evidence does not support the finding by the trial court to the effect that the division order in controversy here included the oil from the Alamo-Duke well as well as the oil from the remainder of the Lizzie Queen tract.
Stress is laid on the testimony of George Campbell and G. A. Young, to the effect that oil runs are usually designated by the names of the operators, and that the Alamo-Duke well was usually known as such because drilled by a company of that name. There is nothing in the evidence tending to show that that custom was discussed between the parties at the time the division order relied on in this suit was executed, or that the parties who executed it had any knowledge of such a custom, or that the custom could have had any material bearing upon the question as to .what oil was intended to be included within the scope of the division order. Such testimony could have no bearing except as tending to show that, at the'time the appellant company accepted the second division order, its officers and other parties thereto then believed that the Alamo-Duke well was not on any portion of the Lizzie Queen 15-acre tract, and for that reason was not one ■ of the wells contemplated in the division order sued on. That is apparent from the fact that the second division order was not executed by F. B. King or Scheneeker or Campbell, who executed the first division order.
*205The following are excerpts from 1 Beach on Modern Law Contracts:
“Sec. 719. Where the language of an instrument is ambiguous and susceptible of more than one construction, that construction will be adopted which, in the light of the surrounding circumstances, and upon a .view of the whole instrument, is in accordance with the apparent intent of the parties. In order to arrive at the intention of the parties, inquiry may be made as to their situation at the time the contract was entered into and the purpose to be accomplished by its execution. , In the construction of contracts, it is the duty of the court to put itself as near as may be in the situation of the parties, from a consideration of the surrounding circumstances and the occasion and apparent object of the parties, determine therefrom the meaning and intent of the language employed in framing their agreement.”
“Sec. 721. If the words or terms of a contract are equivocal, resort may be had to the eir-' cumstances under which the contract was executed, and to the contemporaneous construction given to the contract by the parties. The subsequent acts are admitted to show how the parties understood their contract and are a practical construction of it. It makes no difference whether these acts are contemporaneous or subsequent. It is allowable to .look to them for assistance in ascertaining the true meaning of the agreement. It is a familiar doctrine that when the terms of an agreement are in any respect doubtful or uncertain, and the parties to it have by their own conduct placed a construction upon it which is reasonable, such construction will be adopted by the court, because it is the duty of the court to give effect to the intention of the parties, where it is not wholly at variance with the correct legal interpretation of the terms of the contract.”
The stipulations in the division order sued on clearly show that the appellant company, by the acceptance of that order, understood that it was dealing with every person who had any interest in the oil produced from the Lizzie Queen tract, and that it was in the contemplation of the parties that all the oil produced from that tract should he delivered to the appellant company. That such was the understanding is evidenced further by the fact that the appellant company settled with the parties to that contract for all the oil thereafter produced from the 15-acre tract, exclusive of the .56 acre strip on which the Alamo-Duke well was drilled. In the division order the boundaries of the Lizzie Queen tract were not given, but it was referred to as “lot No. 2, containing 15 acres of the land set apart' to Mrs. Lizzie Queen in- the partition of the W. A. Bearden Lands.” However, the decree of partition referred to was a partition of a tract of 121 acres out of the Juana Selinas survey, the north boundary of which was the south boundary of the Dabney tract, and .also the north boundary of the disputed strip, as described in the lease made by the Bearden heirs, under which the Alamo-Duke well was drilled.. It must be inferred that the parties to the instrument understood that description to include all the land that was legally covered by that description.
We have been cited to no circumstances in the evidence or testimony tending to show that the parties to the division order had any reason or motive for confining the scope of the agreement to the oil from wells drilled by any particular persons. The more reasonable construction, to which all the circumstances point,' is that the agreement intended to cover all oil produced from the Lizzie Queen tract by whomsoever the wells might be drilled; and the fact that the appellant company erroneously concluded that the Alamo-Duke well was not within the boundaries of the Lizzie Queen 15-acre tract could not have the legal effect to limit the proper scope of the division order or release appellant from its obligation to the other parties to the agreement.
As said in opinion on original hearing, the plaintiff’s right of action was based solely upon the division order, and we gave no effect to the conclusion of the trial court that plaintiff was entitled to recover independently of that contract.
The motion for rehearing is overruled.