First State Bank of Tenaha v. Collinsworth

COMBS, Justice. This suit was filed in the district court of Shelby county, Tex., by the First. State Bank of Tenaha, to determine the rights of several rival claimants to a fund of $4,000 deposited with it in escrow in connection with an oil well drilling contract between J. F. Collinsworth as driller, and F. G. Curtain and F. E. Mulroy. J. F. Collinsworth, an oil well drilling contractor, made a contract with F. E. Mulroy and F. G. ' Curtain, owners of certain oil leases in Shelby county, to drill a well. The contract which was -in writing, together with $4,000, the contract price for drilling the well, were placed in escrow with the bank. The agreement contained the following provision: “It is hereby stipulated that the completion of this contract by First Party in such manner as to entitle him to receive the consideration of Four Thousand ($4,000.00) Dollars as set forth above, shall be 1 evidenced by affidavit of N. E. Hendrickson of 120% North College St., Tyler, Texas, and C. A. Parker of Center, Texas, stating that First Pa-rty has completed and complied with said contract the affidavit to be delivered to the- said First State Bank of Tenaha, Texas, and upon delivery of said affidavit said escrow agent shall deliver to the said J. F. Collins-worth, First Party, or order, said Four Thousand ($4,000.00) Dollars.” The contract required the well to be drilled to a depth-of 3,400 feet unless oil should be found in paying quantities at a shallower depth. The appellees pleaded a subsequent oral modification of the contract to the effect that the drilling contract would be considered fulfilled when the Georgetown formation should be reached. The appellants denied that there had been any such modification. Collinsworth drilled the well to a depth of 3,100 feet where the Georgetown formation was struck. The drilling was abandoned without the discovery of oil. Appellees offered proof that Mulroy agreed with Col-linsworth that the drilling might cease and the rig be removed. Mulroy did not take the witness stand to deny the alleged agreement. The proof shows • that the rig was dismantled and'moved away. Before the money was paid out by the bank, however, a dispute developed between Collinsworth, the driller, and Mul-roy and Curtain, the lease owners, as to whether Collinsworth had complied with his contract, the latter contending that the contract required the well to be drilled to a minimum depth of 3,400 feet, which had not been done. The bank, in order to avoid liability, filed this suit impleading the several claimants of the fund and deposited 'the fund in the registry of the court. Thereafter various persons claiming an interest in the fund by virtue of assignments from Col-linsworth for labor and material furnished in drilling the well intervened, setting up their several claims. • The cape was tried to the court without a jury. Considerable testimony was offered by the parties tending to support their respective contentions. The appel-lees also placed in evidence affidavits of N. E. Hendrickson and C. A. Parker, made in accordance with the stipulation above-quoted, and stating in effect that the drilling contract had been complied with by Collinsworth. The trial court entered judgment in effect holding that Collinsworth had complied with his contract and adjudging that Curtain and Mulroy take nothing by their suit. The judgment established the several claims of the interveners and directed the clerk to pay over the fund to the claimants. From that judgment Curtain and Mulroy have appealed. Opinion. We think the judgment of the trial court was correct for several reasons. In the first place the parties specifi [311] cally contracted that Collinsworth should be entitled to the escrow money upon the making of affidavits by N. E. Hendrickson and C. A. Parker to the effect that Collins-worth had complied with his contract. As above stated, such affidavits were introduced in evidence upon the trial. There was no showing or contention that fraud or bad faith entered into the making of the affidavits. And in the absence of such showing the defendants are bound by the determination so made. It has been said that the very object of the designation of such persons whose judgments shall determine when work has been performed in accordance with the contract is to prevent contention and litigation. And generally the legal effect of a determination made by persons so designated is to bind the contracting parties so that neither can question it in the absence of a showing of fraud or bad faith. This principle is discussed in 6 R.C.L. p. 956. But if the making of the affidavits by Hendrickson and Parker are disregarded, still the judgment has ample support in the record. In the’ first place, the evidence was ample to raise the issue that the original contract to drill the well to 3,400 'feet unless oil should be discovered at a shallower depth was subsequently modified by agreement of the parties so that the well would be deemed to be completed upon reaching the Georgetown lime formation, and' that formation was reached in compliance with such contract. In the second place, there was also evidence to support the conclusion that the defendants Curtain and Mulroy, acting through Mulroy, consented and agreed, before the rig was removed, that the contract had been fully complied with. By making the agreement the appellants waived any right they may have had under the contract to insist upon further drilling. The principle involved is discussed in Equitable Life Assurance Society v. Ellis, 105 Tex. 526, 147 S.W. 1152, 152 S.W. 625. Appellants, complain of the failure' of the trial judge to file findings of fact and conclusions of law. The record shows that counsel for appellants seasonably filed a motion requesting the judge to 'file findings of fact and conclusions of law. But it is nowhere shown that the omission was ever called to the attention of the trial judge as required by statute. Vernon’s Ann. Civ. St. art. 2247. The appellants are in no position to complain. Stevenson v. Fisk (Tex.Civ.App.) 65 S.W.2d 507. We will add that the record contains a full statement of the facts and the record shows conclusively, we think, that the trial court entered the correct judgment. As a matter of fairness and right the apr pellees were entitled to their money. The judgment of the trial court is in all things affirmed.