APPEAL from the Circuit Court of Lawrence County; the Hon.
CHARLES T. RANDOLPH, Judge, presiding.
MR. JUSTICE MAXWELL DELIVERED THE OPINION OF THE COURT:
Rehearing denied March 19, 1956.
Plaintiff, Elma Warner, filed her complaint in the circuit court of Lawrence County, which complaint was twice amended, the allegations being made up in two counts in the second amended complaint. The defendants in count I were Frank Gosnell, Dessie Crichfield, and Lee Crichfield. The prayer for relief as it appears in count I of plaintiff's second amended complaint asks that a warranty deed, dated February 15, 1946, from plaintiff, her son and his wife, to the defendant Frank Gosnell, to a certain 26-acre tract in Lawrence County, be set aside, the plaintiff be declared to be the sole owner of the 26-acre tract and an accounting be had of farm operations, leasing and royalties by defendant Frank Gosnell, and payment by him to plaintiff of monies received in excess of the sum due for principal and interest on a certain note and other charges that defendant Frank Gosnell may have had to pay on the land.
In count II of plaintiff's second amended complaint the sole defendants were Ohio Oil Company and Calvan American Company. Plaintiff alleged that on June 22, 1953, defendant Frank Gosnell had leased the land in question for oil and gas to one Davidson, who in turn had assigned the lease to Calvan American Company. Thereafter, Calvan American Company pooled said tract of land with adjoining land leased by defendants Dessie and Lee Crichfield, which Crichfield land had a producing oil well on it. The oil from said producing well was sold by Calvan American Company to the Ohio Oil Company. Under the pooling arrangement between the parties, a percentage of the oil and gas royalty from the Crichfield well was the property of the owner of the land in question. The prayer for relief as set forth in count II asks that these two defendants be ordered to immediately pay any monies in their hands due the Crichfields.
The two Crichfields, Dessie and Lee, entered their appearances but did not contest plaintiff's claim. Defendant Ohio Oil Company answered that it was a mere stakeholder and prayed the court to determine those entitled to payment for oil. Defendant Calvan American Company, by answer, asked the court to rule that its lease be binding on whichever party prevails. The answer of defendant Frank Gosnell and the affirmative defenses therein were based upon three theories: (1) that the transaction was not a loan and security transaction but a sale with an agreement to reconvey upon payment of $1,000, and, alternatively, (2) that even if it should be found that the original transaction was a loan and security arrangement, plaintiff abandoned the security and defendant Frank Gosnell destroyed the note, took possession of the land without any claim or demand from plaintiff until the premises increased in value by reason of the discovery of oil on adjacent premises, after which plaintiff filed this suit without warning, notice or demand, and, alternately, (3) that plaintiff was guilty of laches.
A hearing was had before the chancellor on the issues made up on the complaint and several answers. He dismissed the complaint for want of equity.
The interest of defendants Dessie Crichfield, Lee Crichfield, Ohio Oil Company, and Calvan American Company are not being contested in this proceeding and no appeal is taken from that portion of the decree relating to the oil and gas lease of Calvan American Company, which is recognized as being in full force and effect. The issues in this case are confined entirely to the rights of the plaintiff Warner and the defendant Gosnell.
The issues before the trial court upon the basis of the pleadings were three, to-wit: (I) Was the deed from plaintiff Warner to defendant Gosnell an absolute conveyance coupled with an agreement to reconvey upon payment of a sum certain within a specified time or was it in the nature of a mortgage to secure repayment of a loan, (2) if the deed was in the nature of a mortgage, was there an abandonment of the security by grantor after the loan became due and grantor was not able to pay, and (3) was grantor guilty of laches in not asserting her right to redeem until after the premises conveyed had increased considerably in value?
In her statement as to how the issues were decided, plaintiff states that this appeal is taken from that part of the decree which held that (I) the transaction between plaintiff and defendant Gosnell was a sale and not a mortgage, (2) that defendant Frank Gosnell is the owner in fee of the 26 acres, (3) that defendant Frank Gosnell is the lessor in oil and gas lease with Calvan American, Inc., (4) that 1/2 of 1/8 of oil produced belongs to defendant Frank Gosnell instead of plaintiff and (5) that no accounting should be rendered plaintiff. An examination of the decree entered by the circuit court of Lawrence County shows the following among other findings:
"* * * that the equities in this cause are with the defendants, Frank Gosnell, * * * that Plaintiff's Complaint, as amended, should be dismissed for want of equity, and that the issues of this cause shall be and the same are hereby resolved and determined in favor of Defendant Frank Gosnell, upon his Answer, * * * and against Plaintiff, Elma Warner, upon her Complaint.
"2. That the allegations contained in the Answer of Defendant, Frank Gosnell, to Plaintiff's Second Amended Complaint, * * * shall be and they are hereby found and declared to be true and correct.
"3. That Defendant, Frank Gosnell, is entitled to the relief prayed for in his Answer. * * *
"4. That Defendant, Frank Gosnell, is the owner in fee simple of the premises situated in the County of Lawrence, State of Illinois, described as * * * subject ...