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Leiper v. Gallegos

California Court of Appeals, Second District, Sixth Division

November 20, 2019

Gary D. LEIPER, as Trustee, etc., Plaintiff and Respondent,
v.
Dennis GALLEGOS, Defendant and Appellant; John L. Poole et al., Objectors and Respondents.

         [255 Cal.Rptr.3d 295] Superior Court County of Ventura, Glen Reiser, Judge (Super. Ct. No. P073688) (Ventura County)

Page 395

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[Copyrighted Material Omitted]

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         COUNSEL

         Law Offices of Greg May and Greg May; Jones & Lester; Jones, Lester, Schuck, Becker & Dehesa, Mark A. Lester, Oxnard, and Theresa Loss; Norman Dowler and Brett L. Price for Defendant and Appellant Dennis R. Gallegos.

         Musick, Peeler & Garrett and Cheryl A. Orr, Los Angeles, for Respondent Bank of the West, co-trustee for Austin M. Barnard, deceased.

         John L. Poole, Napa, in propria persona, Respondent.

          No appearance for Plaintiff, Gary D. Leiper as Trustee.

          OPINION

         YEGAN, J.

Page 398

          A tax sale of real property described in the deed as pertaining to surface rights does not include oil and gas rights which are "restrictions of record" in a previously recorded oil and gas lease.

          In 1939, Mr. E.S. Barnard, believed there was oil and gas under a 2.3 acre lot he owned near the Ventura River, Lot 7. He entered into a lease with a major oil company to drill for oil and gas. Mr. Barnard was prescient. For 80 years, it has been a steady and reliable source of oil with no end in sight.

         About 20 years later, Mr. Barnard conveyed fractional interests in the oil and gas royalties to family members. Another 20 years later, one of the fractional owners either did not care, or was not paying attention to a $12.78 tax bill on the surface rights to Lot 7. Upon default, the County of Ventura sold it to the state of California. The state then sold Lot 7 to Mr. and Mrs. Joseph Gallegos for $3000. The tax deed to the Gallegoses was silent on oil and gas. [255 Cal.Rptr.3d 296] Their son, Dennis, appellant, somehow got the idea that he owned the oil and gas under Lot 7.[1]

          The trial court ruled, and we agree that appellant is the surface owner to Lot 7 but he does not now own an interest in the oil and gas under Lot. 7.

         Dennis Gallegos appeals a quiet title judgment that a tax deed for the sale of Lot 7 did not convey the right to receive royalties on a 1939 oil and gas lease. The judgment states that appellant has no interest in the oil and gas royalties from Lot 7. Appellant claims that the trial court "got it wrong" and "threw up its hands and deferred entirely" to the referee’s findings and

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recommendations. That did not happen. We affirm but modify the judgment to show that upon termination of the oil and gas lease, any remaining oil and gas rights described in the 1939 Memorandum of Oil and Gas Lease revert to the surface owner. (Code Civ. Proc. � 43; American Enterprise, Inc. v. Van Winkle (1952) 39 Cal.2d 210, 219, 246 P.2d 935.)

          Facts and ...


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