Edwards v. Hardwick

1960 OK 38, 350 P.2d 495, 12 Oil & Gas Rep. 684, 1960 Okla. LEXIS 311
CourtSupreme Court of Oklahoma
DecidedFebruary 16, 1960
Docket37774
StatusPublished
Cited by19 cases

This text of 1960 OK 38 (Edwards v. Hardwick) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Edwards v. Hardwick, 1960 OK 38, 350 P.2d 495, 12 Oil & Gas Rep. 684, 1960 Okla. LEXIS 311 (Okla. 1960).

Opinions

WILLIAMS, Vice Chief Justice.

The action in the trial court was originally filed by Gertrude Carson to cancel an oil and gas lease covering certain lands in Coal County. Judgment was rendered on plaintiff’s petition cancelling the oil and gas lease. From this part of the judgment no appeal is prosecuted.

This appeal is from the judgment rendered on cross-petitions of two defendants holding plaintiff in error personally liable for unpaid bills for materials furnished and services performed on an oil well located on subject lease. Parties are referred to as in the trial court.

Defendants in the trial court were: W. A. Potter and F. A. Stewart, the lessees of said oil and gas lease; H. A. Williams, Julia May Smith, C. A. Kothe and plaintiff in error A. N. Edwards, assignees of fractional interests in said lease; and C. T. Jennings, R. L. Carpenter, d/b/a Carpenter Well Service Co. (in default) and Independent Eastern Torpedo Company, lien claimants.

Lessees, Potter and Stewart, assigned an (¼⅛) interest in the lease to defendant Williams, a drilling contractor. For this interest Williams agreed to move his rig on the lease and re-work the second of two holes previously drilled on the leased premises.

On February 3, 1953, defendants Potter, Stewart, Williams and Edwards (Plaintiff in error) entered into the following agreement:

“A. N. Edwards agrees to furnish a string of 4¾4" casing F.O.B. Tulsa and Okmulgee and loan a string of tubing for an undivided one-fourth (¼) interest of seven eighths (%) in the * * leasehold lands in Coal County, Oklahoma.
“F. A. Stewart, H. A. Williams, and W. L. Potter agree to complete the well free of any cost to A. N. Edwards, if the well is completed as a commercial well, then all parties pay their part of the tanks, hook up, and A. N. Edwards is to be paid for his tubing at invoice price. If the well is not completed as a commercial well, the other interested parties shall pull the pipe and tubing free of any expense to A. N. Edwards and shall deliver it back to his yard in Okmulgee. Any pipe lost in pulling shall not be charged to the other partners.”

Defendant in error Smith subsequently purchased an undivided interest in the working interest of said lease from Williams out of his 14th.

On February 22, 1953, the reworking of the abandoned well was finished and said well flowed some oil, and when the flow subsided, oil was produced by swabbing. The oil so produced was run into pits. All of the principal parties, Potter, Stewart, Williams and Edwards were present at the well on this date. Upon being informed that there was no money with which to purchase tanks to store this oil, Edwards authorized Williams to order tanks and whatever they needed, to be charged to him, “and such equipment would be put on the same basis as their contract.”

Subsequent production as shown by the evidence was sporadic, a total of 659.7 barrels of oil being run from April, 1953, to March, 1955.

In July, August and September, 1953, plaintiff in error, Edwards, wrote letters requesting return of the equipment furnished for this well or payment therefor.

During September, 1953, and thereafter, Williams, who had been selected as “operator” of the well by Potter, Stewart and Smith, secured from defendants Jennings and Independent-Eastern Torpedo Company further supplies and services in attempting to increase the production. Liens are being asserted by cross-petition for [499]*499such services. These lien claimants sought personal judgments against Edwards on the basis of his alleged personal liability as a partner in a mining partnership, and judgment foreclosing liens on personal property.

The trial court found that plaintiff had sustained her allegations and cancelled the oil and gas lease involved; found that a commercial well had been completed; and that the defendants Potter, Stewart, Williams, Edwards and Smith had entered into a mining partnership for the operation of a well on the leased premises; and that Edwards was estopped to deny that a commercial well had been completed, and awarded defendants Jennings and Independent-Eastern Torpedo Company personal judgments against the partners on the cross-petitions for the amounts due for services and materials, and ordered liens foreclosed.

Plaintiff in error Edwards is the only party appealing from the judgment of the trial court. He presents three assignments of error: (1) A commercial well was not completed; (2) Plaintiff in error is not estopped to deny that a commercial well was completed; and (3) If plaintiff in error’s casing and tubing are subject to liens of lien claimants, he is entitled to judgment against those parties liable for the bills due to such lien claimants, for equipment furnished under the contract.

As this appeal does not present for review the correctness of the trial court’s judgment in so far as it cancels the oil and gas lease, such ruling of the trial court will not be disturbed.

Defendants in error contend that a commercial well was completed, that a mining partnership was created by Edwards, Potter, Stewart and Williams, and that by virtue of such partnership, Edwards is personally liable for all of the expenses incurred in the subsequent work on the well. Whether Edwards is personally liable to such lien claimants under the agreement set out above, is dependent upon whether the well was completed as a commercial well, and upon whether he became a partner in a mining partnership.

This agreement did not create a present partnership, if any at all, but was wholly executory and contingent upon the completion of this well as a commercial well. Ash v. Mickleson, 118 Okl. 163, 247 P. 680; Irelan v. Smoot, 132 Okl. 270, 270 P. 29. Nor does it specifically, by its terms, provide for the future operation of the well or further development of the lease so as to come within the rule stated in Young v. Krumme, 109 Okl. 145, 236 P. 606; Schraeder v. Gormley, 127 Okl. 65, 259 P. 869.

We have defined this term “completion” as used in oil and gas matters several times. In Twin States Oil Co. v. Westerly Oil Co., 93 Okl. 297, 220 P. 839, we defined the term “completion of well” as used in a drilling contract which provides for a limited period of time in which to operate and test a well after its completion. In this situation the term “completion of well” means (includes) the cleaning of the well after reaching the specified depth, so that the sand reached may give that flow of production, by its own force or pumping, which would result from a well so prepared in the ordinary and usual manner for making preparation for such test. See also Arnold v. Adams, 147 Okl. 57, 294 P. 142.

In Uncle Sam Oil Co. v. Richards, 76 Okl. 277, 184 P. 575, 576, in determining the date of completion of a well we said:

“ * * * We think there is but one reasonable answer to the question thus presented, and that is, that the well was completed on the 28th day of November, 1912, when it was successfully shot and commenced to flow oil in large quantities * * * ”

In Howard v. Hughes, 294 Mich. 533, 293 N.W. 740, 741, the court construed the term “completed oil well” when used in a lease requiring commencement of a well within a period of time after completion of a well being drilled by a stranger to the lease on other property.

As defined in the above cases, the term “completed well” has two meanings, de[500]

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Bluebook (online)
1960 OK 38, 350 P.2d 495, 12 Oil & Gas Rep. 684, 1960 Okla. LEXIS 311, Counsel Stack Legal Research, https://law.counselstack.com/opinion/edwards-v-hardwick-okla-1960.