Duffield v. Rosenzweig

144 Pa. 520 | Pennsylvania Court of Common Pleas, Warren County | 1891

Opinion,

Mb. Justice Clark :

This controversy is now before us for the third time, each time in a different form. In order to a complete understanding of the questions already determined, and of the precise question for determination in this case, a brief statement of the facts is necessary. Some time prior to January 23, 1880, C. R. Elston executed a lease for general purposes of. the surface of a certain tract of land in Clarendon, to Thomas and H. W. Brown ; and on that day Elston’s heirs executed a second lease to the Browns of a portion of the same land, for a term of twenty years, for the purpose of mining and operating' for petroleum. On January 20, 1882, the Browns made a lease of the exclusive right and privilege of digging and boring for oil or other minerals to F. M. Pratt, for fifteen years, covering that portion of the land embraced in the last-mentioned lease, but designating certain sites to which the operations for oil were to be restricted. Pratt’s interest subsequently became vested in C. C. Duffield, prior to the defendant’s acquiring any interest in the property. At the time of the execution of the lease from the Browns to Pratt, the Browns had upon the leased premises a saw-mill, connected with which was a yard for the storage of logs and lumber, the mill-yard occupying about two acres of land. During the year 1882, and continuously since, paying producing oil wells have been in operation on the premises mentioned in the lease to Pratt. The title of the Browns, subject to the Pratt lease, afterwards, by virtue of a sheriff’s sale, became vested in Rosenzweig, who, on January 16, 1886, executed a lease for the two acres known as the mill-lot, for oil and mineral purposes, to Hue and Gerould. Six wells were put down by Pratt or his lessees before the sheriff’s sale of June 8, 1885. The seventh well was after-wards drilled, but none of these was on the land in controversy. They were located, substantially, on the respective sites designated in the contract. Several of the wells drilled ’by Pratt and his lessees were not drilled until after the time stipulated in the lease, but there was no claim or notice of forfeiture until February, 1886, when Rosenzweig gave notice that the said lessees’ right to put down wells had ceased. But whatever right the lessors may have had to insist on the forfeiture of the Pratt lease, by reason of the failure to put down the seventh well within the stipulated time, was waived by their previous acquiescence in. the ■ failure to put down within the time two or three of the preceding six wells; indeed, the seventh well would seem to have been put down with Rosenzweig’s consent.

Hue and Gerould, soon after the date of their lease from Rosenzweig, and in pursuance thereof, went into possession of the mill-lot, and commenced operations. Duffield thereupon, on March 6, 1886, filed a bill in equity against them, setting forth his claim of a sole and exclusive right to the premises in dispute, for oil-producing purposes, under the lease from Pratt, and praying for an injunction and for an account for waste, and of the oil produced prior to final decree. This bill was dismissed in the court below as an ejectment bill. Whereupon, on July 18, 1888, Duffield brought an ejectment, which was determined in favor of the defendants; the court being of opinion that the lease of January 20, 1882, gave only the particular sites specified in the lease, and that the lessors, or those claiming under them, had the right to operate for oil elsewhere on the lease, at their pleasure. This case came to this court on a writ of error: Duffield v. Hue, 129 Pa. 94; and whilst the judgment was affirmed, our construction of the agreement was to a different effect. In the opinion filed we said:

“ Whilst by the printed form the leased premises are described as a ‘ certain lot or piece of land situate,’ etc., it is plain from the written clauses that the premises were to be operated at certain designated points or sites only..... The rights of Pratt, as lessee for oil-mining purposes, are plainly restricted to these sites. It is provided that he is to have the privilege of drilling other wells on the same premises, only in the event that the Browns might determine to have more wells drilled, and then the operations were to be conducted on the same terms. Whilst the lease, in some sense, may be said to cover the entire lot for oil-mining purposes, yet it is plain that operations were restricted to the sites mentioned. Whatever oil might be produced from the premises leased, at those points, the lessees had a right to produce; but they had no right of possession, for any purpose, at any other place within the bounds of the territory described. If the lessors, or others acting under them, by boring other wells lessened this production, or otherwise disturbed or interfered with the rights of the lessees, they may have had their remedy, but not in this form; for by no construction of the contract in question can Pratt be supposed to have had any right of possession, for any purpose, in any part of the premises in dispute; and Duffield, in his right, has therefore no standing to recover in ejectment.”

The plaintiff then entered an appeal in this court from the decree of the Common Pleas upon the bill in equity: Duffield v. Hue, 136 Pa. 602 ; which, on October 6, 1890, resulted in a reversal of that decree, and the return of the record for further proceedings. In the opinion we said, in substance, that, although the lessee, Duffield, had no right of possession such as would support an ejectment as to any land outside the sites designated for operation, he had the “ protection ” of the entire premises, and that equity had jurisdiction to restrain the lessor or others acting under him from drilling wells thereon, and from lessening thereby the production of the lessees’ wells. We said:

“ The defendants, having taken possession of the mill-site for the purpose of boring for oil, could not be dispossessed by eject ment; nor was trespass an adequate remedy. It was, without doubt, proper for the plaintiff, if his claims are justified by the proofs, to resort to equity for redress. The injury threatened was of a permanent nature, and destructive of his rights under the Pratt lease. The damages anticipated were incapable of measurement at law. The court below had, undoubtedly, jurisdiction for the prevention and restraint of the defendants, and for redress of the injuries suffered: Allison’s App., 77 Pa. 221; Westmoreland Gas Co. v. DeWitt, 130 Pa. 235.”

During the pendency of this appeal, however, the plaintiff, on November 21, 1889, brought this action of trespass, and proceeded to the trial thereof. Although the trial would seem to have been completed in April, 1890, final judgment was not entered until March 18, 1891.

There can be no question, under our construction of the contract, as to the jurisdiction of equity; any other remedy at the outset, was inadequate. J&ut the jurisdiction in equity does not oust the jurisdiction at law, inadequate as the latter remedy may be. It may be that trespass, in its strict or technical sense, would not be the proper form of action. The lease was of the exclusive right and privilege of operating for oil for the term of fifteen years. It was for a definite term. It was only a grant of the exclusive right “ to operate for oil.” It was not a sale of the oil, and, as we said in Duffield v. Hue, 129 Pa. 94, it must be treated merely as a “lease for the production of oil, and not as a sale of the oil or of the land.” A lease of the mine, when for a definite term, implies the possibility of reversion; that the mineral may be wholly exhausted before the expiration of the term is, in some instances, a possible, perhaps a probable result, but that does not affect the nature of the contract: Del. etc. R. Co. v. Sanderson, 109 Pa. 583; Lazarus’s Estate, 145 Pa. 1. The plaintiff, therefore, did not own absolutely all the oil underlying this lot of land, nor had he possession of it. He was in possession of the land at the seven sites designated, subject to the royalty he stipulated to pay. He was entitled to all the oil he could produce at those sites; and, although limited in his actual operations, he had the protection of the entire premises, and the privilege of drilling other wells on the same terms, if the lessors should determine to have other wells drilled. But, except as stated, he was not in the actual possession of the land, nor, perhaps, of the oil beyond his actual production.

We are of opinion that perhaps an action of trespass, technically so called, could not have been maintained; but, by the act of May 25, 1887, P. L. 271, the distinctions theretofore existing between actions of trespass, trespass on the case, and trover, so far as they relate to procedure, were abolished; and, although the plaintiff’s statement sets forth his claim as in trespass, we cannot, in view of the provisions of the statute, distinguish, in the form of procedure, one from the other. If the facts establish his right to recover in either form, therefore, he is entitled to judgment. In Union Pet. Co. v. Petroleum Co., 72 Pa. 173, the action was case for a disturbance of a similar right. The agreement there was to lease “ the exclusive right and privilege of boring for oil,” etc., which is the exact equivalent of the language employed in the lease now under consideration; and it was held that the right was in the nature of an incorporeal hereditament, but the lessee’s possession was such only as was necessary to the exercise of the right, and that the proper remedy for the disturbance of it was an action on the case. The only assignment of error was that the plaintiffs could not recover in this form of action, unless they had shown to the satisfaction of the jury that they were in the actual possession of the premises upon which the disturbance was alleged to have occurred; but, said Mr. Justice ShabsWOOD, referring to this point in the opinion of the court, “ no authority has been cited in support of it, and it is apprehended that none can be found. On the contrary, it is very clear, from the nature of the case, that possession of the land is not necessary to enable the owner of an incorporeal hereditament to recover damages in this which is the only form of action to which he can resort. In general, he has no right to possession of any part of the land.....In grants of right to bore for oil, there is, indeed, usually, as in this case, a right to possession of so much of the land as is necessary for the exercise of the privilege, but that, like the right of ingress and egress, is but an incident of the incorporeal hereditament. Possession of that might be, no doubt, gained or lost by ejectment, or enforced by trespass guare clausum fregit. To the latter action, actual or constructive possession is necessary in the plaintiff; but never to an action of trespass on the case, as in the common instance of a reversioner suing for a permanent injury to a freehold.” If the plaintiff was entitled to the protection of the entire premises, excepting, perhaps, to the extent that they might be drained by the two wells existing at the time of the lease, and this, by the contemporaneous acts and practice of the parties, would seem to have been the meaning they assigned to the contract, then we are well satisfied that the plaintiff had a remedy at law, inadequate, perhaps, at the outset, for equity alone could restrain and prevent the unlawful acts of the defendants and assess the damages sustained or anticipated, nevertheless a remedy which they had a right to pursue, and that was an action of trespass under the statute; for, although there is complete jurisdiction in equity, that, as we have said, will not oust the jurisdiction, though inadequate, at law. The plaintiff, doubtful, perhaps, as to the result of the proceedings in equity, pursued his legal remedy, and we have now before us the record of this action of trespass.

But, assuming that an action of trespass is a proper remedy, and that the defendant invaded the territory of the plaintiff’s protection to put down wells, and took out oil to the amount of 8,253 barrels, as the testimony appears to show, what should be the measure of the plaintiff’s recovery ? He should not he permitted to recover the price of all this oil, for the defendant was, in any event, entitled to a royalty out of it; and it does not appear, nor can it in any satisfactory way be made to appear, that the plaintiff would have been able, by any means within his power, to produce the whole, or any definite or certain portion of the oil at the sites to which he was restricted. We may reasonably infer from the testimony of the oil operators, who have stated their knowledge of the Clarendon sand and their experience in this oil-field, that the invasion of the plaintiff’s protection was an injury to the production of his wells, and that he is entitled to recover damages commensurate to the injury. But a large part of the testimony introduced upon this subject, it must be conceded, .was of the most unsatisfactory character. It was to a great degree fanciful, conjectural, and speculative. The witnesses were asked to state, from their experience as oil operators, and their knowledge of the Clarendon sand, from the location of the plaintiff’s wells around the mill-yard, and the location of the wells of the defendant, what proportion of the oil produced by those three wells, during the term of the lease from Browns to Pratt, would be taken or could have been taken out through the plaintiff’s wells. The opinions of the witnesses on this subject, as might be expected, varied greatly. The estimates ranged from one third to seven eighths of the production of the three wells. The testimony shows that the subject is one as to which there is great diversity of opinion. Operators have widely different ideas. Some of the witnesses, although stating their opinions, say it is impossible for anybody to make any definite estimate. It is plain, from a careful reading of the evidence, that the estimates made were mere guesses. Besides, if the theory advanced as to the extent of the drainage of the plaintiff’s wells is pursued, how is it possible to determine the effect of the wells on 498, of the two Brown wells on 497, and of other wells on contiguous or adjacent properties ? It is impossible, we think, to make any estimate of the plaintiff’s damages upon this basis which would be even approximately correct. Assuming that this would ordinarily be the proper measure of damages, we are obliged to resort to some other, for, in the very nature of the case, proof upon this basis of assessment is wholly impracticable, indeed impossible.

A party is not confined to a single mode of measuring or estimating his damages. When the ease admits of it, he may resort to different means of arriving at a proper result of the amount of loss sustained in consequence of the injury: Rogers v. Bemus, 69 Pa. 432. As a general rule, where it is practicable or the extent of the wrong ma3r be apportioned from time to time, the plaintiff is entitled to damages to the commencement of the suit, and successive actions may be brought as long as the wrongful conditions continue or the obstruction is maintained: Bare v. Hoffman, 79 Pa. 71. But, where the extent of the wrong is not thus apportionable, or the injury is of a permanent character, the damages may be assessed in a single action : Seely v. Alden, 61 Pa. 302; 5 Am. & Eng. Enc. Law, 17. In this case, the defendant drilled three wells within the protected territory, and the gas which operated the plaintiff’s flowing wells was thereby allowed to escape. The constructions and operations of the defendant’s lessees were of a permanent character, and their entry was for a permanent use and employment. The extent of the injury inflicted upon the plaintiff, in the very nature of the case, is not apportionable from time to time, and we are of opinion that the entire damage, ex necessitate rei, must be assessed in this action.^* Plaintiff’s title is a leasehold, and the proper measure of damages for which the defendant is liable is the difference in the value of the leasehold until the expiration of the term, free from the obstructions which the defendant’s lessees have put upon it, less the value as affected by these obstructions : Pittsb. etc. B. Co. v. Jones, 111 Pa. 204.

There is some testimony bearing upon the depreciation in value of the plaintiff’s lease, by reason of the drilling and operation of the three wells of the defendant’s lessees. Perhaps it is not full enough to justify an intelligent estimate upon that basis; but, as the plaintiff would seem to be entitled to judgment for some amount,

The judgment is reversed, and the record remitted for further proceedings.

* “ When the thing has but one neck, and that is cut off by one act of the defendant, it would be mischievous to drive the plaintiff to a second, third, or fourth action, as the successive consequences of the wrong may arise: ” Mr. Chief Justice Black, in Miller v. Wilson, 24 Pa. 114.—Rep.