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Department of Natural Resources v. Waide

Court of Appeals of Illinois, Fifth District

July 17, 2013

THE DEPARTMENT OF NATURAL RESOURCES, Plaintiff-Appellee,
v.
SHIRLEY A. WAIDE, as Independent Executor of the Estate of Earl Allen, Deceased, CARALEE BIRKESTOL, JENNIFER CLARK, GARY ELLEFSON, PAMELA HAWKINS, GREG LESTER, TOM LESTER, JAMES P. MALLON, JR., JAMES McINTYRE, GARY McWHIRTER, KATHRYN McWHIRTER, CAROLE JEAN MORRISSETTE, SHIRLEY PRESTON, BOB SEARS, DAMON SULLENS, DAVID SULLENS, MARILYN SULLENS, SHARMAINE SWANBERG, SHAWNA LESTER CARNEY, CLIFTON LIMBERT, LYNNE LOVEJOY, MICHAEL P. AND SHIRLEY A. WAIDE, LIVING TRUST DATED JULY 11, 1996, REVISED MARCH 16, 2004, CAROL THOMPSON, MARILYN GIGER, MARY JOHANNA FORBUS, and DANA MOEN, Defendants-Appellants (Jozef Alena, Winifred Basquette, Cindy Briggs, Kathryn Buchman, Patricia Clifford, Karlene Eifolla, Tim Ellefson, Larry Feagler, Nancy Feagler, Debra Grant, Michele Kast, Brian Kittelson, Valeria Klodaski, David Knepper, Anna Mangialardi, Frank Mangialardi, Linda Mischke, Theodore Moen, Scott Morrison, Stephen Morrison, William Morrison, Judy Olsoe, Sandra Jenkins, William Broadbent, Jason Rayburn, Grace Iona Roybal, Teresa Smith, Jack Swicegood, Donald Weaver, Lester E. Weaver, Marlena Weaver, Deep Rock Energy Corporation, and Bi-Petro, Inc., Defendants).

Held [*]

The trial court properly reformed a warranty deed to exclude the grantor’s reservation of an undivided one-fourth interest in the mineral rights of the property conveyed to plaintiff, the Department of Natural Resources, since the Department provided clear evidence of a mutual mistake by establishing that the one-fourth interest at issue had been conveyed by the owners in 1939, and the language “except an undivided 1/4 of the oil and gas” included in the deed to the Department was a mistake that referred to the one-fourth interest previously conveyed; furthermore, neither laches, res judicata nor estoppel by verdict applied.

Appeal from the Circuit Court of Marion County, No. 08-MR-2; the Hon. J. Marc Kelly, Judge, presiding.

Evie S. Horn, of Crain, Miller & Wernsman, Ltd., of Centralia, for appellants.

William L. Broom III and Patricia A. Small, Special Assistant Attorneys General, of Carbondale, and Michael J. Luke, Senior Assistant Attorney General, of Springfield, for appellee.

Panel JUSTICE CATES delivered the judgment of the court, with opinion. Presiding Justice Spomer concurred in the judgment and opinion. Justice Wexstten dissented, with opinion.

OPINION

CATES, JUSTICE.

¶ 1 Plaintiff, the Department of Natural Resources of the State of Illinois (Department), formerly the Department of Conservation, sought reformation of a warranty deed or a declaration that the warranty deed did not reserve an undivided one-fourth interest in the mineral rights of certain property conveyed by the warranty deed. Defendants, the heirs and assignees of the estate of the previous owner of the property, assert collective ownership of the one-fourth interest in the same mineral rights. The circuit court of Marion County reformed the warranty deed in favor of the Department.

¶ 2 On appeal, defendants argue that the Department did not provide clear evidence of a mutual mistake to warrant reformation of the deed. Defendants further contend that the Department's claim to the property is barred by laches, res judicata, and estoppel. We affirm.

¶ 3 On July 24, 1933, J.H. Lewis and Margaret Lewis conveyed by quitclaim deed all interest in the property at issue to Charles W. Warren. By a mineral deed dated January 18, 1939, Charles, and his wife Edith, conveyed an undivided one-fourth interest in the mineral rights of the real estate to the Pawnee Royalty Company. The Pawnee Royalty Company was a partnership comprised of B.A. Guinn and W.A. Guinn. Thereafter, the company conveyed an undivided one-half interest in the mineral rights to each of the Guinn partners. In 1961, by way of condemnation, the Department acquired this previously conveyed one-fourth interest from the Guinns, who were then deceased.

¶ 4 On April 17, 1945, Charles Warren died leaving Edith the property with the remaining three-fourths interest in the mineral rights under the real estate. On June 14, 1958, Edith executed an option contract to sell the property to the Department on or before March 31, 1959, for the price of $3, 500. The option contract specifically set forth that the sale was for the property and a three-fourths interest in the oil and gas under the surface. The option contract executed by Edith also contained the following handwritten note: "1/4 Royalty sold. Just a notation." Defendants admitted in their response to the Department's request to admit that the contract specified a three-fourths interest in the oil and gas was to be sold to the Department.

¶ 5 The Department exercised its option to purchase the real estate within the time specified by the option contract, but Edith died on April 25, 1959, before completing her obligation to convey her right, title, and interest in the real estate by warranty deed. Margaret Shufeldt, the executor of Edith's estate, filed a petition for leave to complete the option contract with the Department. In her petition, Shufeldt requested the court to authorize her to complete the sale of the real estate and "to sell and convey by a good and sufficient [e]xecutor's deed all the right, title[, ] and interest of the said real estate to the" Department. (Emphasis added.)

¶ 6 The circuit court authorized and directed Shufeldt to execute and deliver to the Department "a good and sufficient deed covering the title to the real estate." On December 27, 1960, Shufeldt executed the warranty deed, which described the real estate as:

"The surface and 3/4 of all oil, gas[, ] and other minerals in the Southwest Quarter of the Southwest Quarter of Section 33, Township 4 North, Range 4 East of the Third Principal Meridian; the East Half of the Southeast Quarter of the Southeast Quarter of Section 32, Township 4 North, Range 4 East of the Third Principal Meridian; the Northwest Quarter of the Northeast Quarter of the Northeast Quarter of Section 5, Township 3 North, Range 4 East of the Third Principal ...

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