Smith v. George F. Getty, Inc.

On November 1, 1926, Oliver G. Mason and his wife were the owners of lots 11, 12, 13 and 14, block 36, of the Manila Avenue Tract, in the city of Long Beach, and as lessors, they entered into an oil and gas lease with the defendant corporation covering the four lots named. Prior to the development of any oil, the Masons sold lots 11, 12 and 14, conveying the fee and all their right and interest in the oil lease in the proportion to which the said lots so sold w'ould be entitled, or a total of twelve and one-half per cent of the total production from the four lots. The Masons retained for their own use lot 13 and four and one-sixth per cent of the oil rights. Subsequently, the grantees of the Masons conveyed the lots to other parties, and executed and delivered assignments of their twelve and one-half per cent land owners’ royalty to various persons and corporations, who in turn entered into an oil distribution trust in which the California National Bank of Long Beach was named trustee and distributing agent. Said bank gave notice to the defendant corporation of the trust agreement, and the latter by letter agreed to distribute the twelve and one-half per cent royalty to the said…