|Opinion:||Highpointe Energy v. Viersen, 2021 OK 32|
|Subject matter:||Oil and gas; Quiet Title; Bankruptcy|
|Date Decided:||June 2, 2021|
|Trial Court:||District Court of McClain County (Gray, J.)|
|Route to this Court:||Appeal from trial court’s summary judgment order; Retained by OKSCT on the Court’s own motion.|
|Facts:||The Plaintiff/Appellee filed a quiet title action against the Defendants/Appellants in an effort to quiet Plaintiff/Appellant’s title to approximately 90 net mineral acres. The parties claims to the minerals arise from two different chains of title- one chain stemming from a bankruptcy proceedings and the other from a mortgage foreclosure proceeding and subsequent sheriff’s sale. Both the foreclosure proceedings and the bankruptcy proceedings were ongoing at the same time in the 1930’s in two different courts, in two different parts of the State. |
The mortgage on the property was filed of record and the mineral owner that was the subject of the bankruptcy proceedings was a named defendant in the foreclosure proceeding. In addition, the bankruptcy Trustee was served notice of the foreclosure proceedings. There is nothing in the record to show that the Trustee took any steps to file a copy of the bankruptcy petition in the foreclosure proceedings, to secure a stay of the foreclosure proceedings, etc. Nothing in the record suggests that the mortgage holder participated in the bankruptcy proceedings in any way.
The trial court determined that the Plaintiff/Appellee’s chain resulting from the foreclosure/sheriff’s sale was superior.
|Standard of Review:||Blended. An action to quiet title is of equitable cognizance, and the judgment of the trial court will be affirmed unless found to be against the clear weight of the evidence. However, questions of law are reviewed de novo.|
|Analysis:||The bankruptcy purchaser had at least constructive notice of mortgage and that the bankruptcy Trustee was not selling the property free and clear of all or any liens. The bankruptcy Trustee had both notice and opportunities to remove the mortgage’s cloud on the title of the minerals, but did nothing. |
“A purchaser from the trustee in bankruptcy takes no better title than the bankrupt or trustee had.” Citing Higgs v. Renfrow, 198 Okl. 545. The purchaser’s at the trustee’s sale held the severed minerals subject to the prior mortgage. Therefore, the purchasers from the mortgage foreclosure proceeding hold superior title.
|Vote:||8-0. Opinion by Kauger, J. Concur: Daby, C.J., Kane, V.C.J., Winchester, Edmonson, Combs, Gurich and Rowe, JJ.|