The opinion of the court was delivered by: John E. Miller, District Judge.
On March 5, 1951, the defendant filed a motion for summary
judgment together with statement of the reasons and
authorities in support of the same.
On March 7, 1951, the plaintiffs filed a motion to remand
the case to the Ashley Circuit Court and on March 14 the
defendant filed a statement of reasons and citation of
authorities in opposition to the motion to remand.
On March 29, 1951, at the hearing on the motion to remand,
the plaintiffs asked and were granted permission to withdraw
said motion, which was accordingly done.
On April 7 the plaintiffs filed their response to the motion
for summary judgment together with statement of the reasons
and authorities in opposition to said motion.
In the statement in support of the motion for summary
judgment, the defendant states: "It is urged that the basic
facts necessary to be considered for the determination of this
Motion are so narrowly drawn, and no real issue can be made
with respect to those basic and material facts, this presents
an ideal situation for the application of procedure of Summary
Judgment, as provided in Rule 56 of the Rules of Civil
Procedure [28 U.S.C.A.]."
In the response to the motion for summary judgment, the
plaintiffs state: "There is no particular issue of fact
remaining and the pleadings now reflect the facts and it
remains only for the court to determine as a matter of law
what the final judgment should be."
In the concluding prayer of their response, the plaintiffs
pray that the court enter final summary judgment against the
defendant in the amount of their original prayer.
The record now before the court reflects the following
On February 12, 1951, the plaintiffs filed their complaint
in the Ashley Circuit Court against the defendant and, after
stating the citizenship of the plaintiffs and the defendant,
alleged that on June 7, 1949, the defendant, being the owner
of a certain oil, gas and mineral lease on land situated in
Ashley County, Arkansas, entered into a written contract with
one Claud R. McSpadden, which contract was later amended on
July 15, 1949. The plaintiffs attached to their complaint a
copy of the contract of June 7, 1949, and also a copy of the
amendment thereto of July 15, 1949.
That pursuant to the agreement between the said Claud R.
McSpadden and the defendant, the said McSpadden entered into
operations on the leasehold and, during the course of his
operations and between October 1, 1949, and December 16, 1949,
the plaintiffs furnished the said Claud R. McSpadden materials
of the value of $2,576.32 which were used by him in the
drilling of an oil well on the leasehold. Later the plaintiffs
filed a suit in the Ashley Chancery Court and, on the 18th day
of December, 1950, obtained a judgment against the said Claud
R. McSpadden for said sum of money, with interest and costs.
A copy of the decree of the Ashley Chancery Court is attached
to the complaint.
That the plaintiffs had been unable to collect their
judgment against the said Claud R. McSpadden and the return of
the Sheriff of Ashley County on a special fieri facias
disclosed that the defendant had sold and delivered possession
of the lease including the producing oil well thereon to
another party who is a non-resident of Ashley County,
Arkansas, and who had taken possession of the lease and had
held it continuously under a claim of ownership and had
removed quantities of oil therefrom since September 25, 1950.
That on December 15, 1949, the defendant entered into
another written contract with the said Claud R. McSpadden to
conditionally sell him certain iron or steel pipe described in
the complaint, which pipe was either delivered to the lease or
was in Ashley County, Arkansas, for the purpose of being used
on the lease, and that the equitable interest of the said
Claud R. McSpadden in the lease and in the pipe were subject
to the satisfaction of plaintiffs' judgment but that the
defendant had converted to its own use the lease and the pipe;
that the value of the property converted by the defendant
exceeded the amount of plaintiffs' judgment and that the
plaintiffs were entitled to a judgment against the defendant
for the conversion of said property.
In the motion for summary judgment, the defendant alleges
that, under the terms of the agreement between it and
McSpadden relative to the oil and gas leasehold estate, the
said McSpadden was to have and acquire no right, title or
interest in said estate unless and until the said McSpadden
fully and completely performed and discharged each and all of
the conditions to be performed by him as set forth in said
agreement, as evidenced by the writing of June 7, 1949, and as
amended by the writing of July 15, 1949.
That the said McSpadden failed to perform all of the
conditions set forth in said agreement of June 7, 1949, as
amended, and by reason of such failure the said McSpadden on
September 25, 1950, had no right, title or interest in the oil
and gas leasehold as to which any lien of plaintiffs could
attach or from ...