Thurlow v. Waite-Phillips Co.

22 F.2d 781, 1927 U.S. App. LEXIS 3460
CourtCourt of Appeals for the Eighth Circuit
DecidedNovember 10, 1927
DocketNos. 7701-7703
StatusPublished
Cited by1 cases

This text of 22 F.2d 781 (Thurlow v. Waite-Phillips Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thurlow v. Waite-Phillips Co., 22 F.2d 781, 1927 U.S. App. LEXIS 3460 (8th Cir. 1927).

Opinion

STONE, Circuit Judge.

These three cases, involving the same proposition of law but having different plaintiffs, are presented here under two stipulations. In accordance with the first, it is agreed that the record in No. 7702 shall be printed and entitled in all three eases. Under both- of the stipulations, it is agreed that similar determination shall be entered here of all the cases on the Douthitt record. These appeals are taken from decrees entered after sustaining motions to dismiss the petitions for insufficient facts to entitle plaintiffs to any equitable relief.

The petition in the Douthitt Case alleges that the plaintiff was the owner of certain land described by government survey boundaries containing approximately 131 acres; that this land bordered the Arkansas river in the state of Kansas; that to this land there had formed accretions of 65 acres which had never been surveyed and never "placed upon the tax rolls; that on January 27, 1923, M. W. Baden proposed to plaintiff to take from him an oil and gas lease covering the above surveyed tract and offered to pay therefor the sum of $1 per acre annually in advance for each acre leased; that this proposition was accepted in so far as the 131 acres were concerned bnt was refused as to the accreted lands because the title thereto was in dispute; that in accordance with such an agreement, plaintiff executed a lease covering only the 131 aeres and agreed to warrant and defend the title thereto on condition that Baden should annually pay the sum of $1 per acre, amounting to $131, as rent unless the lands were explored and developed; that this lease was not delivered at the time of signing bnt it was agreed that it should be placed in escrow under an escrow agreement until Baden could secure certain other acreage desired and should begin development upon some of the property covered by a block of leases, of which this was one; that, thereafter, the conditions of the escrow agreement were met and the lease delivered to Baden who assigned it to Johnson D. Hill, who later assigned it to the defendants; that at the time defendants became assignees they had complete knowledge of all of the above facts or could, by the exercise of ordinary care and diligence, have ascertained the same and knew at such time that the lease was intended to cover and did cover 131 acres, and no more; that prior to the institution of this suit plaintiff attempted to lease the accreted lands for oil and gas development purposes; that defendants are publicly asserting claim of title to said accreted lands and have threatened plaintiff with legal proceedings and ac[782]*782tion for damages in case he leases them to any one else; that such action of the defendants easts a cloud upon the title of plaintiff to the accreted lands, has prevented plaintiff from developing same, has prevented plaintiff from securing the reasonable market value of leases upon said land, will result in drainage of the off and gas from such land by the adjacent development and that, because thereof, plaintiff prays the removal of the cloud and adjudication of his title and an injunction against defendants from interfering with his disposition and development thereof. The petition refers to and incorporates, as exhibits, the lease and the escrow agreement. The lease and the escrow agreement are as follows:

Exhibit A.
“Producer’s 88.
“3418 A.
“Oil and Gas Lease.
“Agreement, made and entered into the 27th day of January, A. D. 1923, by and between A. P. Douthitt, a widower, hereinafter called lessor (whether one or more), and M. W. Baden, hereinafter 'called lessee, witnesseth :■
“That the said lessor, for and in consideration of one hundred thirty and no/100 dollars, cash in hand paid, receipt of which is hereby acknowledged, and of the covenants and agreements hereinafter contained on the part of lessee to be paid, kept and performed, has granted, demised, leased and let, and by these presents does grant, demise) lease and let unto the said lessee, for the sole and only purpose of drilling and operating for oil and gas, and laying pipe lines, and building tanks, powers, stations and structures thereon to produce, save and take care of said products, all that certain tract of land situate in the county of Cowley, state of Kansas, described as follows, to wit:
“Lots 6 and 7, and the west half of the northwest quarter of section 17, township 33, range 3, and containing 131 acres, more or less.
“It is agreed that this lease shall remain in force for a term of five years from this date, and as long thereafter as oil or gas, or either of them, is produced from said land by the lessee.
“In consideration of the premises the said lessee covenants and agrees:
“First. To- deliver to the credit of lessor, free of cost, in the pipe line to which he may connect his wells, the equal one-eighth part of all produced and saved from the leased premises.
“Second. To pay the lessor, one-eighth of the proceeds each year in advance, for the gas from each well where gas only is found, while the same is being used off the premises, and lessor to have gas free of cost from any such well for all stoves and all inside lights in the principal dwelling house on said land during the same time-by making his own connections with the wells at his own risk and expense.
“Third. To pay lessor for gas produced from any off well and used off the premises at the rate of one-eighth of the proceeds per year, for the time during which such gas shall be used.
“If no well be commenced on said land on or before the 27th day of January, 1924, this lease shall terminate as to both parties, unless the lessee on or before that date shall pay or tender to the lessor, or to the lessor’s credit in the Oxford Bank, at Oxford, Kansas, or its successors, which shall continue as the depository regardless of the changes in the ownership of said land, the sum of one hundred thirty-one and no/100 dollars, which shall operate as rental and cover the privilege of deferring the commencement of a well for 12 months from said date. In like manner and upon like payment or tenders the commencement of a well many be further deferred for like period of the same number of months successively. And it is understood and agreed that the consideration first reeit-ed herein, the down payment covers not only the privileges granted to the date when said first rental is payable as aforesaid, but also the lessee’s option of extending that period as aforesaid, and anyi and all rights conferred.
“Should the first well drilled on the above described land be a dry hole, then, and in that event, if a second well is not commenced on said land within twelve months from the expiration of the last rental period which rental has been paid, this lease shall terminate as to both parties, unless the lessee on or before the expiration of said twelve months shall resume the payment of rentals in the same amount and in the same manner as hereinbefore provided. And it is agreed that upon the resumption of the payment of rentals, as above provided, that the last preceding paragraph hereof governing the payment of rentals and the effect thereof, shall continue in force just as though there had been no interruption in the rental payments.

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Bluebook (online)
22 F.2d 781, 1927 U.S. App. LEXIS 3460, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thurlow-v-waite-phillips-co-ca8-1927.