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Shell Oil Co. v. Manley Oil Corp.

December 3, 1941


Appeal from the District Court of the United States for the Eastern District of Illinois; Fred L. Wham, Judge.

Author: Minton

Before EVANS, MAJOR and MINTON, Circuit Judges.

MINTON, Circuit Judge.

The question we are asked to decide on this appeal is whether the conveyance of the "surface only" of a described tract of land subject to coal rights theretofore conveyed, grants also the oil and gas rights under said tract of land, or whether the oil and gas rights remained in the grantor.

Thomas M. McKemie and wife made a deed in 1907 to Walter S. Mooneyham, conveying to him the "surface only" of two acres therein described land in Franklin County, Illinois, subject to a deed theretofore made to Benton Coal Company of the coal rights under the land. This land came by mesne conveyance to John C. Shoemate who, joined by his wife, Florence Shoemate, leased the oil and gas rights to the defendant-appellee, the Manley Oil Corporation. Those claiming through Thomas McKemie and his wife to the oil and gas under the land, notwithstanding the deed of the McKemies to Mooneyham in 1907, made a lease of oil and gas rights to one Adkins, who assigned the lease to Shell Oil Company, the plaintiff-appellant, who brought a suit against Manley Oil Corporation, to enjoin it from drilling for oil and gas upon this land. Judgment for the Manley Corporation led to this appeal.

The essential parts of the above-mentioned deed read as follows:

"The grantors, Thomas M. McKemie and Lou McKemie his wife * * * Convey and Warrant to Walter S. Mooneyham * * * the following described Real Estate, to wit: the surface only of a tract of land described as follows, * * * This deed is made subject to a certain deed to the Benton Coal Company recorded in Deed Record 45 page 10. * * * "

The decision in this case turns upon the proper construction of this deed. What did the grantors mean by the words surface only"? Are these words ambiguous, and is the intent of the parties obscure by reason thereof? Courts are not authorized to make contracts for the parties, but must construe them as written, and where plain, common words are used in their ordinary meaning, they must be accepted in that sense. In the Supreme Court of Illinois in Englestein v. Mintz, 345 Ill. 48-60, 177 N.E. 746, 752, the Court said:

"In construing a contract the words used must be given their well-recognized, ordinary meaning, unless it appears from the context of the contract or from the explanation of some ambiguity therein that such was not in accordance with the intent of the parties."

The word "only" is a limiting and restrictive term which qualifies the word "surface," and in that sense means "solely" or the equivalent of the phrase "and nothing else." Moore v. Stevens, 90 Fla. 879, 106 So. 901, 902, 43 A.L.R. 1127. And so the word "only" as used in connection with the word "surface" limits and restricts the word to nothing else but "surface."

We are of the opinion that these words have a well-defined meaning and are not ambiguous, and that it was not proper to receive evidence to interpret the meaning of these plain and ordinary words used in clear and unmistakable manner. See Keweenaw Ass'n v. Friedrich, 122 Mich. 442, 70 N.W. 896; Dolan v. Dolan, 70 W.Va. 76, 73 S.E. 90, Ann, Cas. 1913D, 125.

We proceed to the consideration of the meaning of the words "surface only" as used in the deed. The law of Illinois seems to be clear that there may be a severance of the estate in surface from the estate in subsurface. Threlkeld v. Inglett, 289 Ill. 90, 124 N.E. 368; Renfro v. Hanon, 297 Ill. 353, 130 N.E. 740; Lloyd v. Catlin Coal Company, 210 Ill. 460, 71 N.E. 335.

The authorities seem also to recognize the right of severance to extend to as many strata as there may be in the subsurface. Smoot v. Consolidated Coal Co., 114 Ill.App. 512-514; Gill v. Fletcher, 74 Ohio St. 295, 78 N.E. 433, 113 Am.St.Rep. 962; Knight v. Indiana Coal Co., 47 Ind. 105, 17 Am.Rep. 692; Lilibridge v. Lackawanna Coal Co., 143 Pa. 293, 22 A. 1035, 13 L.R.A. 627, 24 Am.St.Rep. 544.

In the case at bar there had been a severance of the coal in the deed to the Benton Coal Company, and the deed in question was made "subject to" the coal rights granted to Benton Coal Company. The insertion of the words "subject to a certain deed to the Benton Coal Co." were used to protect the grantors on their warranty. This did not amount to a ...

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