52 W. Va. 276 | W. Va. | 1902
On tiro 27tb day of July, 1889, Bion L. Coro leased to Joseph S. Brown his farm containing seventy-seven acres, in consideration of fifteen dollars paid in hand and the stipulations, rents and covenants on the part oE the said Brown to be ke|ot and performed “For the sole and only jrarpose of boring, mining and excavating for petroleum or carbon oil and gas,” and piping the same. Which lease was for the term of two years from its date or so long thereafter as oil or gas should continue to be found in paying quantities. Said Brown, his heirs and assigns, to deliver in the pipe lines one-eighth of the oil and a yearly rental of $200 for each and every gas well, and which lease contained the following provision: “The party of
At the September rules, 1898, B. L. Core, filed his bill in the circuit court of Pleasant County against The Hew York Petroleum Co., a corporation, Joseph S. Brown, Brown Oil Co., a corporation, Gilbert L. Watson, Marcus A. Bettman, David Bettman and Henry Goodkind, claiming damages in the amount of ten thousand dollars because of failure and neglect and careless operations and. failure to develop the property under the said lease by drilling other wells on said land and not protecting the lines of the same and holding the lease while the land was being drained by oil wells on adjoining lands, and praying for the cancelation of said lease, in case it should be found that oil Avas not being produced in paying quantities, and for damages for the. neglectful and careless manner of operating said wells ami for the non-production and drainage of said premises, and in case it should be ascertained that oil was being produced in paying quantities then for a decree that unless the defendant, Hew York Petroleum Co., should commence within a
The defendant, Few York Petroleum Co. filed its demurrer to the bill, stating the following grounds of demurrer: ' “That the same is not sufficient in law. Second. That as shown from the face of the bill, the complainant has full, complete and adequate remedy at law for the recovery of any damages which he alleges in his bill he has sustained in consequence of the matters and things therein alleged. Third. That the only allegation contained in the said bill which would give the complainant a standing in a court of equitjq and which would cause him to be entertained by a court of equity when he has a complete and adequate remedy at law, is the allegation that the lease of this defendant is a cloud upon the title of complainant’s property, and this has been so repeatedly decided by the Supreme Court of the State o£ West Virginia that a lease of the character o£ the one described in the complainant’s bill, does not vest in the lessee any right, title or interest in the corpus of the property leased, but is simply a permit to search for and produce oil. Hence, that allegation when considered under the light of the law of the State of West Virginia does not give to the complainant the right to be heard or entertained in a court of chancery. For these and other causes of demurrer apparent on the face of the complainant’s bill this defendant demurs thereto.”
Which demurrer was averruled on the 20th of October, 1898, and the defendants were given leave to file their answer within thirty days from the rising of the court. On the 17th of January, plaintiff excepted to the answer which had been filed in the office on the 25th of October, 1898. Which exceptions were sustained and the-defendant company given thirty days to file a better answer. An amended and supplemental answer was
The first assignment of error is the overruling of the demurrer to plaintiff’s bill. Appellant claiming that plaintiff neither averred nor proved any equity; that if he had any cause of action whatever his remedy was at law and not in equity. It is not disputed, but even shown by the allegations of the bill, that the wells when completed “Produced considerable quantities of oil,” which must have been in “Paying quantities.” Under the authorities, whenever oil is discovered and produced under a lease of the character of the one in question, estate and property in the oil and gas underlying the premises is vested in the lessee' and his assigns. In Koch's and Balliet’s Appeal, 93 Pa. St. 434, the lessee had the exclusive right to mine the iron ore on lessor’s land, one-sixth thereof to be paid to lessor. The mining was carried -on for several years when the lessee suspended operations. Lessor filed his bill in equity to compel the lessee to proceed with the mining or to deliver up the contract .for can-celation, and the co-urt decreed accordingly and awarded damages. This was held to be error; that there was no jurisdiction in equity, as an action at law for breach of covenant would clearly lie. It will be observed on careful reading of the lease in
Contract of lease in this case shows on its face that the premises were in an undeveloped and untested held. The lease provided that “The party of the second part agrees to and within one month froan this date commence a test well for gas and oil in the vicinity of this farm/5 and then provides for drilling on the premises leased. In testing and drilling in the vicinity and on the premises the lessee and his assigns were entitled to use their own judgment in such development. The circuit court has not only attempted to decide how many wells shall be drilled upon the premises, but how deep and into what sands they shall be drilled, virtually depriving tire operator of tire exercise of any judgment or discretion iii his operation of said premises, interpolating new duties on the part of the lessee and his assigns, thus creating a new contract between the parties in relation to the development of the property. In Colgan v. Oil Co., cited, Justice Mitchell in writing the opinion of the court says: “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 upon 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 loado, 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 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.”
The case of Kleppner v. Lemon, 176 Pa. St. 502, is a similar case to the one at bar insofar as it was its purpose to forfeit the
The decree is reversed and the bill dismissed.
Reversed.