Black v. Been

George Rose Smith, J. This suit was brought by the appellees, Luther and Vera Been, to obtain reformation of a deed by which they conveyed a tract of about forty acres to the appellants, Virgil and Lois Black. The complaint asserts that the parties intended for the grantors to reserve all the mineral interest in the land, but by mutual mistake this reservation was left out of the deed. The chancellor sustained the plaintiffs ’ contention and entered a decree granting the prayer for a reformation. The appellants’ principal insistence is that the appellees failed to meet the burden of proving by clear and convincing evidence that a mutual mistake occurred. Hicks v. Rankin, 214 Ark. 77, 214 S. W. 2d 490. After a careful study of the record we are unable to say that the chancellor was wrong in holding that the plaintiffs satisfied their heavy burden of proof. In 1948 the Beens executed a written contract by which they agreed to sell this tract and another forty to Lloyd and Janice Mills for $3,000, payable in installments over a period of ten years. The contract expressly provided that the sellers were to reserve all the minerals underlying both tracts. Later in 1948 the purchasers assigned their interest in the contract, which had been recorded, to Marion and Minnie Phillips, who began to pay the yearly installments in accordance with the agreement. In 1952 the appellant Yirgil Black negotiated with Marion Phillips for the purchase of the tract now in controversy. After some haggling about the price it was finally agreed that Black would buy the land for $1,000. This arrangement was acceptable to the appellees, the Beens, who had their attorney prepare a deed conveying the land to the Blacks. The purchase price of $1,000 was paid to the Beens, who applied it as a credit against the balance that was still owed by the Phillipses as assignees of the original contract. Although that contract had provided for a reservation of the minerals no such provision was inserted in the deed from the Beens to the Blacks, and this is the instrument that the chancellor reformed. The pivotal question is whether the Blacks had knowledge of the fact that the minerals were to be retained by the Beens. On this point both Marion Phillips and his wife testified positively that PTack was informed during the negotiations that the minerals were not to be included in tbe sale. (Mrs. Phillips also says that she showed the original contract to Virgil Black, who read it.) This testimony is corroborated by Luther Clark, an apparently disinterested witness, who states that he heard part of the discussion between Phillips and Black and that the former told Black “that Mr. Been’s mineral rights don’t go with it.” Thus three witnesses, none of whom has any pecuniary interest in the case, affirmatively state that Black was told about the reservation of the minerals. On the other side there is only the testimony of Virgil Black, an interested party, who denies that anything was said about the mineral rights. This conflict narrows down to an issue of credibility, upon which we are guided by the chancellor’s decision. Souter v. Witt, 87 Ark. 593, 113 S. W. 800, 128 A. S. R. 40. Counsel for the appellants vigorously insist that there could not have been a mistake common to the Beens and the Blacks, because the latter negotiated only with the Phillipses and did not discuss the proposed transaction with these appellees. Even so, these litigants were the sole parties to the deed, which is the contract now in controversy, and we are convinced that they labored under the same mistake about its contents. That is, the sellers assumed that the deed contained a reservation of the minerals, because that provision was contained in the installment contract that gave rise to the deed; and the buyers also assumed that the minerals were being reserved, because they had been so informed during the negotiations with the Phillipses. It is plain enough that a mutual mistake can exist even though the buyer and seller have not dealt directly with each other; for otherwise reformation could never be had with respect to an agreement negotiated through an agent, a broker, or some third person. We find no merit in the appellants’ remaining contention, that the appellees are barred by laches as a result of not having filed their suit until 1958. This defense does not appear to have been pleaded or presented in the trial court, and, further, there is nothing to indicate that the delay has worked any disvantage to the appellants. Jewell v. General Air Conditioning Corp., 226 Ark. 304, 289 S. W. 2d 881; Jones v. Temple, 126 Ark. 86, 189 S. W. 847. Affirmed. Ward and Johnson, JJ., dissent.