Almost overnight the Medderses had people lining up to extend them credit. The couple initially borrowed $20,000 (for a down payment on their Muenster home) from the Catholic monks at Subiaco Abbey in Arkansas. A spokesman for the monks told Fort Worth Weekly that, in their case, Ernest and Margaret repaid the loan promptly.
According to her later courtroom testimony, Margaret told the nuns with whom she worked that she and Ernest needed money to pursue the riches through the legal system. Margaret testified that Ernest promised that, if the sisters financed the legal fight, he would give their order $10 million of his newly spied inheritance.
After that, the nuns began funneling money to the Medderses on a regular basis. It was on the advice of the Sisters that the family pulled up stakes and moved to Muenster, a town dominated by Catholicism. Before that, according to one Muenster businessman, the couple hadn’t even been Catholics.
“The Medders were originally Baptists, so they needed to impress these nuns,” said Rufus Henscheid. “They converted to Catholicism and started looking for a good Catholic town. So where’s a good Catholic town? Well, at the time Muenster was about 90 percent Catholic.” In Muenster, the couple, like almost everyone else in town, attended Sacred Heart Catholic Church.
According to a 1967 story in the Gainesville Register, Margaret testified in a bankruptcy court hearing in Sherman that she and her husband had received a series of loans from the Catholic order in the form of checks “in the neighborhood of $50,000 to $75,000 per month” between 1962 through 1966.
Where did that money come from? And what — other than dollar signs in their eyes — could have possessed the nuns to make such loans, underwriting what was clearly an outlandish lifestyle as well as a legal fight?
Neither they nor anyone else in the Catholic Church has ever commented on their reasoning, other than to say that the nuns thought the Medderses were sincere in believing the oil money would come. The whole Medders scandal seems to have been expunged from the records — and even, apparently, the memories — of the Catholic church in Indiana.
In Muenster, the nuns’ money was floating more boats than Ernest and Margaret’s. Some folks liked the couple; others just liked their money and resented their flamboyant and high-handed ways. At least one town resident knew that it was the Sisters’ money rather than oil proceeds that, in the short term, was underwriting the Medders phenomenon.
It wasn’t resentment over who was invited or not invited to their soirees that led to the Medderses’ downfall, however. It was one man’s irritation with their Democratic politics.
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John Pagel’s desk is up half a flight of stairs at the rear of Community Lumber’s main building on Highway 82, in the center of Muenster. The smell of freshly cut wood fills the air, just as it must have when his father Jerome ran the company and, for a few years in the 60s, built buildings for and a friendship with the Medderses.
A medium-sized, slender, sun-tanned man of 68, his dark hair going gray, John Pagel at first said he didn’t know much about Muenster’s most infamous former residents. But once he started talking, the memories and laughter rolled out.
John was just 17 when that particular circus hit town. And if Jerome Pagel wasn’t the first local that the Medderses got to know, he may have gotten to know them the best.
“When they came to town, we [helped them get] everything they wanted,” John Pagel said. “They wanted a water well; we built them a water well. … The next thing was that they needed a place to live. We got them a place to live. The next thing was, ‘build us a house.’ ”
So Jerome built their house, one that John figures would cost $1 million today. After that, Ernest and Margaret started filling it with possessions and party guests.
For the first event, the couple invited the entire community. “They wanted to have an open house and have the community introduced to them,” Pagel said. “And they decked the whole house out with new furniture. Booked a champagne brunch and champagne bar, My brother Dick and I and one of our friends were the bartenders. They had these big old magnums of champagne, serving it in these crystal glasses.”
He and his friends smuggled some of the bubbly out to a car, but as it turned out they didn’t need to.
“She had made us dress up in coats and ties, and that wasn’t our thing,” Pagel recalled. “So, five o’clock came along, and the housewarming had come to an end. Mrs. Medders hugged us, had her arms around us like we were her little chicks. And she said, ‘Now, boys, don’t you tell your dad, but why don’t you take three or four magnums of this champagne?’ So when we got out to the car, we had more champagne than we knew what to do with.”
Jerome Pagel also built horse and cattle barns for them, including the one that doubled as a party palace. “It made a hell of a dance floor,” his son recalled. “It was a dirt floor, but they had a portable wood floor [brought in] for dances and dinners.” He remembers LBJ’s helicopter landing out at Colonial Acres.
Great article Steve. I worked with a district Alabama Judge in the private sector on up-dating the heirship claim to The Estate of Pelham Humphries from 1986 until the time of his sudden illness and death in August of 1993. The old judge, as an attorney, had taken over the claim after W. T. Weir whom everyone in my family knew as ‘Old Barefoot’ because he sat in his wheelchair in his sock feet to practice law. The old judge always stated in private and in public that the KEY to Ernest and Margaret Medders being able to draw that money from The Catholic church was for two reasons. First, Margaret found out about the money coming to St. Josephs from the Spindletop accounts while she was snooping around on the night shift at St. Josephs in Memphis. Second, Ernest knew all about the claim through his first marriage prior to his marriage to Margaret. Do you know anything about Ernest’s first marriage? I knew about the newspaper article that originated in Tuscaloosa, Alabama. I was told that the lawyer behind that took in alot of money and moved to South America??? I wrote two books about Spindletop following the old judge’s untimely death.
He was planning on retiring from the bench and filing as administrator of The Pelham Humphries Mineral Estate. He stated this at many public meetings. Death prevented his dream. Up-date…there is a suit pending to be filed in Beaumont, Texas (May 21, 2012) styled Wayne Hodge vs. State of Texas, Commissioner of the Texas General Land Office and
the descendants of W. P. H. McFadden. This might be worth watching if it is litigated. My interest is that my ancestors were summoned by The President of The United States, William McKinely in July of 1901 as heirs of Pelham Humphries. We WON and were granted leave to amend per Case 512 CL90 in Jefferson, Texas (Marion County) in September of 1901. Something happened and the old judge told us that our case is still open in State Court. I have worked two jobs most of my life and assure you that, unlike Ernest and Margaret Medders, I have never received any money from Spindletop. Oh by the way, if the current case goes to court, there is a MEDDERS claim that will probably intervene. These folk contacted me recently as to any knowledge I have that would help them They seem to be nice people but are claiming under a one-eighth unrecorded drilling document.
Again, great article Steve. Sincerely, Jackie Carroll 205 410-5799
My grandmother was friends with Margaret Medders when they lived in the Hometown Subdivision south of Memphis. My mother and I went to visit them later when they were living in the housing project, Lauderdale Courts. I was impressed because that was where Elvis used to live, but they were pretty hard up because she was working as a nurse’s aide and even though Earnest was a mechanic, he had a bad back and wasn’t working. I was a teenager at the time, but my mother took them a few gifts for their kids because she knew their money was tight and they didn’t get many luxuries. I found it so amazing when I later heard about all that happened to them and their move to Texas.
Not that it matters, and I don’t know about Earnest, but I do know that Margaret was always a Catholic.
Oh how interesting. It’s so unusual for a very poor person to be so greedy & flamboyant.
Maybe I’ve just never known anyone that obtains such an opportunity. I remember it well when ther Medderes air castle burst. I am from Montague County & it was mesmerizing. Apparently Margaret Medders had no consicience. She had lots of gall!
I was told many years ago that a Medders drilled 1st well of Spindletop. That we was heirs and not received payout? My Grandmother was a Medders.
My late X husband was 5th generation from Pelam
Humphries. They never received a payout. It’s interesting history. My Great Grandmother was a Yates I also heard they were very wealthy from oil.
Love history. If you have any info on any of this
love to hear from you.