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Stanley v. Collins

Court of Appeals of Texas, Thirteenth District, Corpus Christi-Edinburg

November 7, 2019


          On appeal from the 77th District Court of Freestone County, Texas.

          Before Chief Justice Contreras and Justices Hinojosa and Tijerina


          DORI CONTRERAS Chief Justice

         Appellants RR Stanley, Dalton Davis d/b/a JO-DAN Royalty Company, and Vinella Davis challenge the trial court's judgment in favor of appellees Deborah Cephus Collins, Will Cephus, Harold Andrews, Rosalind Carter, and Rondal Cephus. After a bench trial, the trial court found appellants liable for conversion and fraud and it awarded appellees actual and exemplary damages. On appeal, appellants argue that the trial court should have dismissed the suit as an impermissible collateral attack on a prior judgment, and that the evidence was legally insufficient to establish the elements of appellees' claims. We affirm.[1]

         I. Background

         This case concerns the mineral estate in certain land in Freestone County. On June 19, 2003, pursuant to a lawsuit filed by Devon Energy Operating Company, LP (Devon), the 77th District Court appointed a receiver to execute a lease in favor of Devon and to distribute royalties arising therefrom to the unknown heirs of the most recent record owner, Peter Daniel, who died in 1930. See Tex. Civ. Prac. & Rem. Code Ann. § 64.091(b) (providing that a district court may appoint a receiver for the mineral interest owned by a nonresident or absent defendant in certain circumstances). As relevant here, the June 19, 2003 order stated that Lillie Jones[2] and Blanche Williams, two of Peter Daniel's grandchildren, were owners of 37.5 net mineral acres in the subject property. The county clerk established accounts in the court's registry for the benefit of Jones and Williams and their unknown heirs. See id. § 64.091(h) ("Money consideration paid for the execution of a lease, assignment, or unitization agreement by the receiver must be paid to the clerk of the court in which the case is pending before the receiver executes the instrument. The court shall apply the money to the costs accruing in the case and retain any balance for the use and benefit of the nonresident or person of unknown residence who owns the mineral or leasehold interest. Payments made at a later time under the lease, assignment, or unitization agreement shall be paid into the registry of the court and impounded for the use and benefit of the owner of the mineral or leasehold interest."). Those accounts had together accumulated around $1 million in royalties as of 2009.

         In 2009, appellant Dalton Davis (Dalton) sought to acquire the mineral interests of Jones's and Williams's unknown heirs. He contacted Aline Marshall, Jones's granddaughter, in order to determine the heirs' identities. Marshall signed an affidavit stating that appellees are the among the rightful heirs, and the affidavit was recorded in the Freestone County public records. Dalton then contacted the heirs and offered to purchase their interests. Some heirs agreed to sell their interests, but appellees declined Dalton's offers.

         The following year, in the same cause number as Devon's suit, Dalton petitioned the trial court for disbursement of the funds in the receivership accounts. At a hearing, Dalton testified that he and the other appellants had acquired all of the mineral interests owned by the heirs of Jones and Williams. Dalton produced an affidavit executed by Mary Jones Parks, [3] another heir identified by Marshall. In her affidavit, Parks stated that Lillie Jones was her grandmother, that Blanche Williams was her great aunt, and that both women died intestate. According to Parks, at the time of their respective deaths, Blanche Williams had no children and Lillie Jones had two children: L.K. Jones and William Jones, Parks's father. Parks stated in her affidavit that her father had eight children in total; that six of them survive, including herself; that one of her deceased brothers has three surviving heirs; and that her other deceased brother had no children. She stated L.K. Jones had no children.

         The trial court issued an order on June 8, 2010, stating that appellants are the successors-in-interest to the heirs of Lillie Jones and Blanche Williams. The order further provided:

6) IT IS THEREFORE ORDERED that all monies held in receivership, trust, or suspense for the heirs of Blanche Williams and the heirs of Lillie Jones shall be disbursed to the successors in interest named herein, specifically 25% to Vinella Davis, 37.5% to R.R. Stanley, and 37.5% to Dalton Davis and Jo-Dan Royalty Company, after ad litem fees are first paid.
7) IT IS FURTHER ORDERED that Devon Energy Operating Company, LP and its successors and assigns shall pay all future royalty payments heretofore attributable to Blanche Williams and Lillie Jones directly to Vinella Davis, R.R. Stanley, and Dalton Davis/Jo-Dan Royalty Co. [o]r their assigns, as their interests appear herein·above.

         No party appealed the June 8, 2010 order. On July 13, 2010, funds were distributed from the receivership account as follows: $371, 149.78 to Dalton; $371, 149.78 to R.R. Stanley; $247, 433.19 to Vinella Davis; and $10, 000 to the attorney ad litem appointed for the then-unknown heirs.

         In the instant lawsuit, filed in 2012, appellees claimed that more than $165, 000 of the funds in the receivership accounts were rightfully their property, and they argued that appellants "continued to collect royalties from several gas unit wells" on the subject land. Appellees asserted that Dalton and/or Vinella Davis "for a reported payment of $12, 000.00 convinced [Parks] to sign a false affidavit or statement, which completely ignored the heirship of [appellees] herein." Appellees sought declaratory relief, including a judgment quieting title, as well as damages for conversion and attorney's fees. Appellants answered the suit, denying the factual allegations and asserting affirmative defenses including res judicata and collateral estoppel.

         At a bench trial on September 21, 2015, Parks testified that she did not prepare her 2010 affidavit; rather, it was prepared for her, and she signed it. She stated that she and some of her siblings also signed over their mineral interests to Dalton in exchange for $12, 000.[4] Parks testified, contrary to her affidavit, that her grandmother Lillie Jones had three children: her father William, Robert, and Vera.[5] She agreed that Vera is the grandmother of appellees and that appellees are therefore her cousins. When asked why she "executed a statement that was not correct" in 2010, Parks replied: "Because at the time [Dalton] had given me tons of information that sounded as if it could actually be possibly true. . . . [W]hen we discussed it, I was told that he could prove everything that he said, and we trusted and believed that." Parks later agreed that she was "desperately short of money" at the time she agreed to sign the affidavit.

         Without objection, a program from the 1982 funeral of William Jones Jr., Parks's father, was entered into evidence. The program stated that William Jones Jr.'s parents were William M. Jones and Lizzie Jones. According to the program, William Jones Jr. had eight children, one of which predeceased him. It states that he was survived by his wife, five sons, five daughters, twenty-one grandchildren, three great-grandchildren, and one sister, Vera Lee. When asked if the program is "a true and correct statement of your dad's heirship," Parks replied: "As to my opinion, yes, sir, it is, because up until meeting Dalton Davis I had no idea that there could be any other record."

         On cross-examination, appellants' counsel introduced copies of death certificates for William Jones Jr. and for Vera Lee. Both death certificates indicated that the decedent's father's name was William Jones Sr. and the decedent's mother's maiden name was Lizzie English. Counsel also introduced a death certificate for Veline Cephus, appellees' mother, which stated that Veline's mother's maiden name was Vera L. Jones.

         Appellants Vinella Davis and Robert Raymond "RR" Stanley were called by appellees as adverse witnesses. Vinella Davis declined to testify on Fifth Amendment grounds. Stanley stated that he received a check for over $370, 000 from Dalton in 2010. The checks written on the clerk's receivership account were entered into evidence, showing that Stanley had in fact been paid directly by the district clerk's office. Stanley testified: "I was thinking it came from Dalton personally, though, because he owed me the money." He denied knowledge of any fraud perpetrated by Dalton.

         Marshall testified that she met with Dalton and her cousin Vince Jones in 2009. She provided the men with some information, they put it in an affidavit, and she signed it. She affirmed the truth of the facts set forth in her affidavit, and the affidavit was entered into evidence. Marshall denied that Dalton ever explained to her that "this had an impact on how about a million dollars was supposed to be divided up." She stated that Dalton paid her about $30, 000 for her share of the mineral interest at issue.

         On cross-examination, at appellants' counsel's request, Marshall identified a 1927 death certificate for Lizzie Jones. The death certificate states that the decedent was born in 1879, that the decedent's father's name is Clayte English, and that the decedent's mother's name is Mahalila Ohmbues. Counsel also produced a copy of an 1880 Freestone County census document appearing to list Peter Daniel and his children, including Mattie ...

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