Eastern Oil Co. v. Coulehan

64 S.E. 836, 65 W. Va. 531, 1909 W. Va. LEXIS 79
CourtWest Virginia Supreme Court
DecidedApril 27, 1909
StatusPublished
Cited by53 cases

This text of 64 S.E. 836 (Eastern Oil Co. v. Coulehan) is published on Counsel Stack Legal Research, covering West Virginia Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Eastern Oil Co. v. Coulehan, 64 S.E. 836, 65 W. Va. 531, 1909 W. Va. LEXIS 79 (W. Va. 1909).

Opinion

Mlller, President:

August 3, 1901, defendant and wife executed and delivered to West Union Gas Co., a lease, which on the same day it assigned to plaintiff, and whereby in consideration of two hundred and fifty dollars,, and other valuable considerations, the said lessors granted and demised unto said lessee all the oil and gas in and under a tract of one hundred and eighteen acres in Doddridge county and also said tract of land for the purpose and exclusive right of operating thereon for oil and gas, together with other rights usually appertaining to such leases, and containing this habendum: “To have and to hold the same unto the lessee for the term of five years from this date, and as much longer as oil ór gas is produced, or the rental paid thereon.” The lease also stipulates that the lessor shall be paid a royalty of one eighth part of all the oil produced and saved; and thereafter at the rate of two hundred dollars yearly for each gas well as long as gas therefrom is sold, payable within sixty days after commencing [533]*533to use gas therefrom, the lessor to have gas for his dwelling from any gas well free by making connections; and, in case no well shall be completed within three months from.the date thereof the same to become absolutely void and of no further effect whatever on either party, unless the lessee shall pay for further continuances of the privileges therein mentioned the sum of fifty dollars quarterly, payable in advance until a well shall be completed; and that the lessee may at any time re-convey the premises “thereby granted” and ^hereupon be forever discharged from all liability to the lessors under any and every provision thereof accruing after such, re-conveyance and the instrument be no longer binding on either party. In Ohio a lease of this character, for a consideration, with granting clause, a habendum, a condition subsequent or defeasance clause, and a surrendering clause, is held to be a lease and not merely a license. Brown v. Fowler, 65 Ohio St. 507, 521, citing Woodland Oil Co. v. Crawford, 55 Ohio St. 161, and Martin v. Jones, 62 Ohio St. 519, 525. In this State and in Pennsylvania, such leases are generally treated as mere licenses vesting no estate, the title thereto, both as to the period of years and the term thereafter remaining inchoate and contingent on the finding of óil and gas. Crawford v. Ritchey, 43 W. Va. 252; Steelsmith v. Gartlan, 45 W. Va. 27; Headley v. Hoopengarner, 60 W. Va. 626.

The plaintiff, having paid the cash consideration entered, and regularly paid the quarter annual instalments of rent in advance for the full period of five years, but did not begin the work of drilling for oil or gas until June, 1906, after the last quarter had begun. It owned other leases adjoining and in the same neighborhood, on some of which it had put down wells, the wells drilled, defining defendant's land as gas, but not oil, producing territory. We take judicial notice that gas, unlike oil, can not be brought to the surface and stored to await a market for it, but must remain in nature’s storehouse, and, unless allowed to waste away, taken out only as and when the producer may be able to find customers to take and consume it.

Plaintiff, having 'then invested in bonus money and rentals, twelve hundred dollars, in June, 1906, began a well on defendant’s land, and, about July 20, struck gas in the salt sand at the depth of about 1240 feet, which when gauged, and tested showed a capacity of about 3,000,000 cubic feet per day. After striking [534]*534this gas, however, he concluded to go deeper, to the lower or Indian sand. The well was begun in ample time 'to have completed it in the lower sand, but shortage of water, due to the drouth, caused a delay of several days. Finding the time growing short, and defendant declining to extend the term except uj>on terms deemed oppressive, orders were given the drillers to work on Sunday. The defendant seeing the drillers at work suggested that they were la3dng themselves liable to arrest and conviction for working on Sunday, and they were frightened away and refused to work. Thirty minutes, about, after midnight of August 2, 1906, defendant with witnesses, appeared at the well, where the drillers were at work on the night tower, and inquiring of and being informed by them that the well was not yet completed in the lower sand, notified them that the lease had expired at midnight, that the rights of lessee had ceased, and that all from that time would be treated as trespassers. The drillers in'the absence of the owners stopped drilling, went home and went to bed, and work was not resumed until noon of August 3rd, a loss of about twelve hours in time. The drilling then begun was continued until shortly before one o’clock of August 4th, when ■gas in immense quantities was struck in the Indian sand, the only interruption being the second appearance of the defendant with witnesses shortly after the previous midnight to again notify the drillers that the lease had then expired and ordering them off the premises. The plaintiff having refused to vacate the premises the defendant on August 4, 1906, instituted against the plaintiff in the circuit court of Doddridge county a suit in unlawful detainer to recover possession of the property.

On December 8, 1906 the plaintiff upon its original bill obtained from said circuit court of Doddridge county an injunction protecting it in the possession and occupancy of said land, and enjoining defendant from in any manner interfering with any of its rights specified in said lease of August 3, 1901, and from in any manner interfering'with it in the use, occupancy and operation of said land for oil and gas purp'oses under said lease, and also, from prosecuting his said action of unlawful detainer until plaintiff’s rights under said lease should be settled and determined in this suit, and until the further order of the coiirt. The further prayer of the bill was on the grounds alleged that the court would decree plaintiff vested with the title to and inter[535]*535est in all tlie oil and gas according to and subject to the terms of said lease, and that the said lease be held firm and valid.

At January rules, 1907, the plaintiff filed an amended bill amplifying the grounds of relief alleged in the original bill, renewing the prayer thereof, and upon hearing upon said original and amended bill and the separate answer of John C. Coulehan thereto and upon the depositions and proofs taken and filed in the cause, the decree of September 7, 1907, appealed from, was pronounced by the circuit court, whereby, the court being of opinion that the evidence did not sustain the material grounds for relief alleged, decreed that said injunction bo wholly dissolved, the plaintiffs original and amended bills dismissed, but though expressing no opinion as to the production .of gas in the salt sand, reserves to plaintiff the right to interpose the same as a defense to said action of unlawful detainer.

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Bluebook (online)
64 S.E. 836, 65 W. Va. 531, 1909 W. Va. LEXIS 79, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eastern-oil-co-v-coulehan-wva-1909.