65 W. Va. 595 | W. Va. | 1909
Hugh Evans, on 20th September, 1899, leased a tract of 528 acres of land in Taylor county to U. S. Ditman and J. C. Gaw-throp for production of oil and gas. The lease provided that Evans have free of charge gas for use in his residence. The lease to continue for the term of five years “and so long thereafter as oil or gas, or either of them, is produced therefrom by the party of the second part, heirs, executors, achninstrators or assigns.” The lease deed provided that the lessee deliver into pipe line to the credit of Evans one eighth of oil produced and pay two hundred dollars yearly for “each gas well the product from which is marketed and used off the premises.” The lease provided that the lessees drill a well within twelve months or pay thereafter one hundred and thirty-two dollars quarterly until one should be drilled. Ko well having been drilled within twelve months, the sum of one hundred and thirty-two dollars was paid Evans, extending the lease to 20th December, 1900. Before the 20th December the Southern Oil Company under some agreement with Ditman and Gawthorp drilled a well and produced gas in December 1900. The casing was drawn from the well and the well prepared for use by the insertion of a wall-packer and 1,400 feet of tubing, and a cap at the top, with a gate through which the gas could be removed. This was done to save all gas. Tests of the gas produced in the well were made
It cannot be said that the first lease is forfeited by any express forfeiture clause found in it. The theory of the McGraw Company is, that such a lease confers no vested estate in oil or gas in the earth, but at most confers only a right to search for oil and gas, and that only when oil or gas shall be found in paying-quantity and marketed does any est.ate vest in the lessee, and that no estate ever vested under the first lease, because the gas found was not in paying quantity. This lease does not limit its term by requiring that oil or gas shall be found in paying quantity, as leases usually do. It says that the lease shallvendure “five years from this date and as long thereafter as oil and gas, or either of them, is produced therefrom by the party of the second part.” So, this lease contains nothing in terms allowing the lessor to end it because oil or gas is not found in paying quantity. And if there were such provision, I should regard it as made in the interest of the lessee to protect him from payment of the annual sum for a gas well, if insufficient in quantity, and not as intended to give the lessor right to terminate the lease against the lessee’s will, he treating the quantity as sufficient and electing to pay. What right has Evans to say that no estate vested by reason of insufficiency of gas, when the lease makes no such provision, and the lessee chooses to regard it as sufficient and pay as if it were? And again it has been held, even
Title having vested, the lease contains no clause that forfeits it. It is argued not definitely, but virtually, that failure to drill other wells forfeits. We have frequently held that where there is no express provision requiring additional wells, but only an implied one, this will not forfeit. Core v. Petroleum Co., 52 W. Va. 276; Kellar v. Craig, 126 Fed. R. 630. I have never been reconciled to the doctrine that for failure to drill additional wells the lessor must sue at law for damages, and equity will not cancel unless for draining from near by territory and thus exhaust oil in the leasehold involved. I have asked, Iiow many actions must the landlord bring? Iiow can damages be measured? Iiow can we see into the depth of the earth? But it has been so held. The reason .is, that equity will not, as a rule, enforce a forfeiture of an estate. It will not especially insert such a claues when the parties have not inserted it, especially when they did insert forfeiture for failure to drill or pay commutation, but did not insert forfeiture for failure to drill additional wells. As to duty to drill additional wells for gas, the Pennsylvania supreme court has held, practically, that it does not exist in gas as in case of oil, because of the difference. A small oil well can be used; a gas well of slight pressure will not enter the gas line. McKnight v. Manufacturers Gas Co., 146 Pa. St. 185 (28 Am. St. R. 790). That was for both oil and gas, but development seemed to show the section to be gas territory, as in this case. But we express no opinion as to this. We only say there can be no forfeiture for mere failure to drill more wells.
It is argued that failure to market the gas forfeits the lease. So it was claimed in Summerville v. Apollo Gas Co., 207 Pa. St. 334, as to a lease for two years “and as much longer as oil and gas are found in paying quantities,” and the court said that the lessor had no right to forfeit at the end of two years because during that time no oil or gas had been marketed. “It may be
Is it claimed that the well and lease have been abandoned? As said in Urpman v. Lowther Oil Co., 53 W. Va. 506, “The loss of property by abandonment is not easily shown nor readily held by the courts.” “To constitute abandonment by the lessee •of a lease for oil there must be both an intention to abandon, and actual relinquishment of the leased premises.” Sull v. Hochstetter, 63 W. Va. 317, says the tenant must quit and the landlord taken possession to work abandonment. Abandonment is not only not. established, but plainly negatived in this case. The lessees paid and Evans received for seven years the rental money for the well. The lessees tendered for the year 1907. The leasehold was assessed with taxes to Kennedy. The lessee put in the well 1,500 feet of tubing, wall packer and casing head. The lease was at different times conveyed from one to another as an existing lease. The Grafton Ice Company in December 1904 paid one thousand dollars for the lease, and made preparation to pipe the gas from the well to Grafton to its ice manufactory. They have eared for the well, blown and tested it, and never been ■out of possession, nor has Evans ever tried to expel that company from his premises. He sa3rs he never hindered it from going on the premises to attend to the well, and that “they always had that right.”
Therefore, we reverse the decree, and dismiss the bill filed by the McGraw Company, and we decree that the lease in the record specified dated 20th day of March, 1907, from Hugh Evans and wife to the McGraw Oil & Gas Company be canceled, annulled and set aside as to the rights of the Crystal Ice Company, Robert M. Kennedy, the South Penn Oil Company and all other parties having rights derived under and by virtue of the
Reversed and Remanded.