Ware v. Langmade

6 Ohio Cir. Dec. 43
CourtHancock Circuit Court
DecidedDecember 15, 1894
StatusPublished

This text of 6 Ohio Cir. Dec. 43 (Ware v. Langmade) is published on Counsel Stack Legal Research, covering Hancock Circuit Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ware v. Langmade, 6 Ohio Cir. Dec. 43 (Ohio Super. Ct. 1894).

Opinion

Day, J.

The plaintiffs, John R. Ward and F. B. McConica, and the defendant, R. D. Rangmade, are, and have been engaged in the business of drilling, mining, operating for and producing petroleum oil and gas. In August, 1894, plaintiffs had the exclusive right, by a proper lease, to drill and operate for oil and gas on a tract of land in section four, Portage township, Hancock county, Ohio, and the defendant, at said date, by a similar lease, had the exclusive right to drill and operate on lands lying in the same section and adjacent to the lands of plaintiffs, on the north, east and south 'ides. These several tracts of land are valuable and productive oil and gas territory. Contiguous oil and gas territory can be most profitably operated by the different owners by reserving a strip of territory about 200 feet wide, on each side of the dividing line, entirely free of wells; and the [44]*44best results are obtained in the Ohio oil fields by locating and constructing the wells nearly or quite 400 feet from each other. Wells nearer together than 350 or 400 feet are injured by their proximity, are less productive and shorter lived. To refrain from drilling wells nearer the dividing line than about 200 feet, is necessary to secure the just rights of adjoining proprietors, and in that light is mutually beneficial to the adjacent leaseholders. With a view to lessen the expense of operating their said leases, and for their mutual benefit, in the securing to each a just and full share of the product, the plaintiffs and defendant, in August, 1894, made and entered into an agreement, not in writing, whereby it was mutually stipulated, promised and agreed by and between them, in consideration of the mutual benefits to accrue to each of them, that neither of them would drill any well or wells for oil or gas nearer than 200 feet of any boundary line dividing their contiguous parcels of oil territory. The said agreement was acted upon by both parties, and in part carried into effect, each party drilling a number of wells on either side of the line, and observing and complying with the provisions of the agreement by not drilling within 200 feet of the line. Plaintiffs have observed and performed the terms of the said agreement in every particular, and relying on it, and because of it, have expended large sums of money in operating their said lease, and have located and constructed a number of wells each of which has been located and constructed with reference to, and in compliance with the provisions of the said agreement, the required distance from said dividing line ; yet the defendant, in violation of the stipulations of said agreement, and for the purpose of injuring and distressing plaintiffs and to obtain undue advantage of them, has located and commenced drilling a well for oil within fifteen feet of the said division line, and will complete the said well, and will drill other wells in violation of the said agreement, unless prevented, and will thereby greatly and irreparably damage and injure plaintiffs and their property.

The foregoing facts, substantially, were stated by the plaintiffs in a petition as a cause of action, and relief touching them prayed for by injunction. The defendant, by answer, interposed three defenses: First — A denial that any such, agreement was made and entered into. ’ Second — If any such agreement was made it was entirely without consideration on the part of either plaintiffs or defendant, and therefore void. Third — If any such agreement was made, there was no note or memorandum of it in writing signed by the parties, or either of them, and that such an agreement was and is within the statute of frauds, and void.

. The facts, as claimed by the plaintiffs, and as herein first stated, are clearly established by competent and satisfactory evidence. That there was an agreement between these parties, fairly made and entered into, as asserted by plaintiffs, based on the consideration that it would be mutually just and advantageous;, that the parties to it, for a time, in good faith acted upon it, relied upon it, and operated their leases in accordance with its terms, and that the defendant was violating and making breach of it, is not at all doubtful; nor is it a matter of doubt that the arrangement was an eminently proper and reasonable one, -necessary, just and fair to both parties, and not at all detrimental to either. It also' appears that a breach of the agreement, by drilling wells near the division line as proposed by the defendant, will be injurious to plaintiffs; and it follows that plaintiffs are entitled to a decree in their favor, as prayed for, unless the agreement is void for want of a consideration passing between the parties; void under the statute of frauds and perjuries, because an agreement for land or concerning an interest in land, and not in writing and signed by the parties; or, unless plaintiffs have mistaken their remedy in bringing an equitable action for injunction instead of an action at law for damages for breach of contract, as urged by-counsel for defendant.

Was the agreement without consideration, and therefore void?

It is the holding in Ohio, that a promise is a good consideration for a promise; that mutual promises, if made with reference to a proper subject matter. [45]*45■support each other and furnish a good consideration upholding and sustaining an agreement fairly and reasonably made. In this case there was a mutual agreement. Mutual promises — a promise for a promise — and the subject matter of the mutual promises was not in any sense an improper one, and the integrity of the agreement might, with propriety, -be held on that basis alone, if there was no other on which to rest it. There is, however, more in the case than merely mutual promises; there are considerations having real actual value. Here was a ■division line between contiguous tracts of oil lands, belonging separately to plaintiffs and defendant. Each owner had an undoubted right to drill wells at any point on the lease, and in as close proximity to the line as might be deemed proper; but if one owner constructed a well near the line, so must the other, in ■order to protect his rights and interests, and secure a fair and just portion of the valuable deposits found in the lands near the division line; and in doing this there was liable to result clashing, rancor, possibly entanglements and litigation, and certainly increased expenditure in operating the leases; diminished earnings and financial loss, to both; to avoid and prevent which the parties might, with propriety, make an arrangement that would be largely beneficial in a pecuniary sense, to both; and having come to an agreement on the matter, and mutually promised each other, their contract may very well be said to be based on considerations both valuable and good.

The claim that the agreement is within the provisions óf the statute of frauds and perjuries, presents a closer and more difficult question. Section 4199, Revised Statutes, provides, among other things, that contracts for land, or concerning interest in land, shall be void, unless some note or memorandum of such ■contract is in writing and signed by the parties to it. The contract in question was not in writing and signed by the parties, and if it was a contract for land, or an interest in land, it is clearly within the provisions of the section, and cannot be enforced. The question then is: Was this an agreement for land or an interest in land within the meaning of the law — were the parties, in any legal sense, contracting for any interest in real estate? After due consideration of the matter, we reach the conclusion that in no legal sense was it a land contract.

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6 Ohio Cir. Dec. 43, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ware-v-langmade-ohcircthancock-1894.