Appeal, No. 183 | Pa. | Dec 30, 1899
Opinion by
This is a bill in equity by lessor against lessee for specific performance of covenants, or in the alternative for forfeiture of the lease and also for an account. As the covenants are merely implied, and their extent depends altogether on oral evidence of opinions, the case for relief is wholly wanting in that precision and certainty of contractual duty which is necessary to sustain the ordinary chancery decree for specific performance. The jurisdiction of equity in a similar case was, however, sustained in Kleppner v. Lemon, 176 Pa. 502" court="Pa." date_filed="1896-07-15" href="https://app.midpage.ai/document/kleppner-v-lemon-6243814?utm_source=webapp" opinion_id="6243814">176 Pa. 502, and we do not now propose to question it. But that decision was on the ground of fraud, the majority of the Court being of opinion that the defendant was fraudulently evading his obligations to plaintiff while draining the oil from plaintiff’s land through wells on adjacent territory. “ The findings show,” says Williams, J., “ that it is the expressed purpose of the defendant to secure Kleppner’s oil through his wells on the Garlach and Stotler tracts of land.” The basis necessary to sustain the bill, therefore, is fraud, and that of course must be affirmatively and clearly proved.
The defendant contracted by its lease to put down one well on the plaintiff’s land; it has in fact put down five. The bill chai’ges, however, that the five were put down on the eastern half of the farm, to the neglect of the development of the western half, and further, that, although five wells were sunk on the eastern side, yet defendant was unduly draining that part of the land by wells on adjoining territory leased from other owners. As to this latter complaint the bill asked that such outside wells “ be decreed to be wells taking and draining the oil from plaintiff’s said land,” and that an account and payment be ordered. The plaintiff’s case, however, was so absolutely wanting in merit on this branch that the learned judge below not only granted no relief, but did not even discuss it in his conclusions of law. It would not be necessary, therefore, for us to consider this part of the case at all, were it not that the evidence throws a very strong light on the main question of good faith in the defendant’s whole plan of operations for the development of the farm.
As already said defendant’s contract obligation was to sink one well. It has sunk five. One of these, known as Colgan No. 5, it was desirable in defendant’s judgment to locate very near the line of another lessor, Caldwell. Defendant accordingly consulted both plaintiff and Caldwell, who both agreed to the location chosen, with the notice from defendant to plaintiff that if it proved a paying well, defendant would in justice to Caldwell put down another on Caldwell’s side of the line as an offset. This was done. The well on plaintiff’s side of the line proved a fair producer, though it declined after a few weeks, and the other well was then sunk on Caldwell’s side and proved about an equal producer. This second well, known as Caldwell No. 4, is the chief subject of plaintiff’s complaint and re
On the other branch of the case the court below found that the western half of the farm “ would furnish at least one paying well ” and decreed that a well should be put down by the appellant. There is unfortunately no evidence whatever to sup
The extent of plaintiff’s own testimony was that he thought he “could get plenty of other parties to take” the land, “but I will do it myself.” This is very far short of what is required. So long as the lessee is acting in good faith, on business judgment, he is not bound to take any other party’s, but may stand on his own. Every man who invests his money and labor in a-business does it on the confidence he has in being able to conduct it in his own way. No court has any power to impose a different judgment on him, however erroneous it may deem his to be. Its right to interfere does not arise until it has been shown clearly that he is not acting in good faith on his business judgment, but fraudulently, with intent to obtain a dishonest advantage over the other party to the contract.
Nor is the lessee bound in case of difference of judgment to surrender his lease, even pro tanto, and allow the lessor to experiment. Lessees who have bound themselves by covenants to develop a tract, and have entered and produced oil, have a vested estate in the land which cannot be taken away on any mere difference of judgment. It is not within the jurisdiction of any court to oust the owner and forfeit the title to estates in that way, and the- jurisdiction of equity to decree any specific act or declare forfeiture depends on fraud averred and fully proved. Experimental drilling of other wells on the western portion of this tract' may work injury to defendant’s wells already down, without any corresponding advantage to the plain-, tiff. The weight of the evidence is that such would be the probable result, but whether it would or not the defendant is not bound to submit to the experiment. It has an estate in the whole tract, has fully performed its agreement in relation
Decree reversed and bill directed to be dismissed with costs.