Case ID: ohio-st_53/html/0136-01.html
Source: Caselaw Access Project
Author: {"author": "Btjrket, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Stahl v. Van Vleck.
    
      Lease of land — For obtaining oil and gas— Construction of lease— Time of performance — Rights of parties.
    
    1. A party of the first part being- the owner of three adjoining tracts of land, each containing- forty acres, leased one acre thereof, to be designated by himself, to a party of the second part, and in the lease it was “agreed on the part of the party of the first part, that if oil or gas be obtained by the second party or assigns, in or under the provisions of this contract, upon said tract, or on lands adjoining the same premises of which the foregoing one acre described embraces a part, said second party shall have the right to operate forty acres of the balance of said premises on the same terms as above. ’ ’ Held, that the forty-acre tract out of which the one acre was thereafter selected by party of the first part, is the forty acres to be operated under the contract. Walsh v. Ringer, 2 Ohio, 328; Cunningham v. Harper, Wright, 366; Hay v. Storrs, Wright, 711, followed and approved.
    2. In said contract it was further “agreed that if second party or their assigns, do not commence a test oil or gas well at Rising- Sun or vicinity in ninety days, this lease to be void. ” Held, that a test well at that place having been commenced and completed in ninety days, whereby the existence of oil at that point was ascertained, that such performance supplied a sufficient consideration for the contract of lease, even though the test well was immediately plugged and casing withdrawn.
    3. The party of the first part having selected the one acre upon which such well was to be drilled, and the second party having acted thereon, the first party is bound thereby, and has no right to make a second selection.
    4. It being agreed that such lease should “continue and be in force for five years from the date thereof,” and the second party having commenced operations in good faith to drill for oil in ample time to complete a well within said term of five years, was wrongfully enjoined by the lessor, and the injunction kept alive until after the expiration of the term of five years; Held, that the second party is entitled at the close of the litigation, to as much time in which to perform his contract, as still remained of his term when he was first enjoined.
    (Decided June 11, 1895.)
    Error to the Circuit Court of Wood county.
    The controversy between the parties arose out of a duly acknowledged written instrument, which was recorded in the records of Wood county in the words and figures following:
    “contract.
    “Executed this 15th day of December, A. D. 1886, by and between Arie E. Stahl, of Wood county, Ohio, as first party, and C. W. Manahan, Jr., and A. K. Detwiler of Toledo, Ohio, witT nesseth: That the said first party for the consideration hereinafter stipulated and agreed upon, does hereby grant to said second parties or their successors and assigns, the right to enter upon the following lands and premises now owned by said first party, and situated in Perry township, Wood county, Ohio, to wit:
    “A tract to be designated by first party of one acre on the following described premises: The south half of the northeast quarter of section two (2), in town three north, of range twelve (12) east; also the northeast quarter of the southeast quarter of said section two, in township and range aforesaid, containing forty acres of within described premises; for the purpose and with the exclusive right in and upon said premises to drill and develop oil, gas and other valuable substances, and the exclusive right of way to said second party or their successors and assigns, to'convey over, upon and through said premises, any and all oil, gas and other valuable substances.
    
      “In consideration whereof it is hereby agreed: First — If oil be found’ and developed upon said premises in paying quantities, the said first party is to receive as his royalty the one-eighth part thereof of the oil in pipe lines to credit of first party, at the well. Second — Should gas be found and developed upon said premises, said first party is to have the right to use and consume for lighting and heating his dwelling, such amount as may be necessary therefor; and the additional sum of three hundred dollars per annum for each gas well, when and as soon as the same is marketed and utilized. Third — From and after the expiration of twenty-four months from the date hereof, and until second party enter upon said premises and exercise the rights and privileges hereby granted, the said second party will pay to said first party, during the continuance of this contract, the sum of fifty cents per acre per year, upon each acre herein contracted for, to be paid out of the first moneys realized or received by said second party from the development of gas or oil.
    “ It is further agreed by and between said parties, their successors and assigns, that this contract and the rights and privileges therein granted and conferred, shall continue and be in force for five years from the date hereof, or so long as oil, gas, or other valuable substances be found and developed upon said premises in paying quantities.
    “It is also agreed that the second party or their successors and assigns, shall have the right and privilege of necessary roads to and from all wells, or mines developed upon said premises, and the right to remove all machinery, fixtures and buildings placed by them upon said premises.
    
      “It is further agreed on the part of the party of the first part that if oil or gas be obtained by the second party or assigns, in or under the provisions of this contract upon .said tract, or on lands adjoining the same premises of which the foregoing one acre described embraces a part, said second party shall have the right to operate the balance of said premises on the same terms as above.
    “In case said second party, its successors and assigns shall not commence operations upon said premises within five years from the date hereof, then this contract shall be void.
    “It is agreed that if said second party or their assigns, do not commence a test oil or gas well at Rising Sun or vicinity in ninety days, this lease to be void.
    “Signed and executed by the parties hereto, the day and year first above written.
    “Arie E. Stahl,
    C. W. Manahan,
    A. K. Detwiler,”
    “Signed and executed in the presence of
    “G. H. Baker,
    L. C. Winchell.”
    . By the assignments duly recorded, this contract became the property of defendant in error, George EL Van Vleck.
    On the 8th day of August, 1891, plaintiff in error, also plaintiff below, filed his petition in the court of common pleas, seeking to enjoin defendant from going upon said premises, erecting any derrick, placing any timber thereon, drilling any wells or removing any oil or gas therefrom, and for a reformation of said agreement, its cancellation, and for equitable relief.
    
      This injunction ancl relief was sought upon the alleged ground that the conditions of said instrument had not been performed, and no rental had been paid, no test oil or gas well had been commenced at Rising Sun or vicinity within the time specified, that no consideration whs paid for said contract, that the same was without consideration, that only forty acres of land were included in the contract, but by mistake the whole one hundred and twenty acres were included .in the written instrument, that said instrument was not acknowledged, and that the same is a cloud upon his title.
    The defendant, by his answer, averred that the test well at Rising Sun was commenced and drilled to completion within ninety days from the date of said contract, that thereby it was demonstrated, at great expense, that oil does exist in said lands, that he was about to drill a well on plaintiff’s lands, and offered to pay any rental due under said contract when stopped by this suit, and asks to be protected in his rights and for other proper relief.
    After trial in the common pleas, the case was appealed, and on trial the circuit court made the following finding of facts and law:
    “That on the 15th day of December, A. D. 1886, the plaintiff, Arie E. Stahl, executed and delivered to C. "W. Manahan and A. K. Detwiler the written contract, or oil lease, a true copy of which is set forth in answer of the defendant, George H. Van Vleck, herein, except the next to the last stipulation.
    “Said stipulation being the second one above the words ‘Signed and executed, etc., when said contract was executed and delivered, read as follows, to wit:
    “ ‘It is further agreed on the part of the party of theJSLrst part that if oil or gas he obtained by the second party or assigns, in or under the provisions of this contract, upon said tract or on lands adjoining the same premises, of which the foregoing- one acre described embraces a part, said second party shall have the right to operate ‘40 acres of’ the balance of said premises on the same terms as above. ’
    “ The court finds that in the said contract as originally executed and delivered, the words ‘40 acres of’ were interlined at the place where they occurred, and that the recorder in recording said instrument overlooked the interlineation which had become somewhat blurred and obscure, so that the said contract or instrument appears upon the record precisely as set forth in defendant’s answer, or rather as set forth in the exhibit, which defendant has attached to his answer herein, but the said clause as it appears in said answer and in the record should be corrected and reformed, so as to contain the words ‘40 acres of, ’ in order to conform the same to the instrument as it was when executed and delivered.
    ‘ ‘ That said lease when executed and delivered did not confer upon the defendant the right to operate the whole of the farm in case gas or oil was found on the one acre designated in the lease, but upon only forty acres thereof, if gas or oil was so discovered, and was so interlined in the original instrument which was assigned to Van Vleck, and taken into his possession at the time of his purchase thereof.
    “And the court further find that said contract of lease, bjr written assignments duly made and acknowledged, has been transferred to, and now belong-s to the defendant, George H. Van Vleck; that by virtue of such assignment the defendant, George H. Van Vleck, has become entitled to all of the rights and privileges granted and conveyed by said lease to the original grantees, G. W. Manahan and A. K. Detwiler; that the said George H. Van Vleck was not aware when he purchased said lease that any error had intervened in the record thereof, nor did he have personal knowledge that the words ‘ 40 acres of ’ were in the said lease or instrument (although they had been interlined . therein, at the time of its execution), until the day of the trial of this cause in this court.
    “That said George H. Van Vleck purchased said lease in good faith and paid a valuable consideration therefor.
    “ And the court also find that Manahan & Detwiler, the original grantees in said lease, commenced a test well in the vicinity of Rising Sun within ninety days after the execution of said contract of lease and in accordance with the terms thereof.
    “ That said well was not situated on plaintiff’s land, and was about one and one-half miles therefrom.
    “That said Manahan & Detwiler in due time drilled said well down to the oil-bearing rock, and for a sufficient distance therein, to determine the character of the land; that oil was found in said well, and the existence of a deposit of oil at that point was ascertained.
    “ That immediately after the completion of the drilling of the well as aforesaid, the said Manahan & Detwiler plugged the said well, drew the casing and did not further operate same.
    “That said lease was assigned to and became the property of defendant, Van Vleck, on the 30th day of March, A. D. 1887.
    “That no operations were commenced by anyone, under said lease upon the lands of plaintiff, until about two weeks previous to the commencement of this action, and no rent was paid thereon.
    
      ‘ ‘ That at the date last aforesaid the defendant, through one Graham, his agent, requested the plaintiff to designate the acre of land upon which he desired to have a well located.
    “ That plaintiff thereupon designated a location for said well upon the southwest quarter (i) of the northeast one-fourth (i) of section 2, mentioned in petition.
    “That pursuant to such designation by the plaintiff and prior to the commencement of this action, defendant in good faith and with the intent to drill for oil under said lease, commenced placing material at the point so designated for the purpose of drilling.
    “That soon afterwards the plaintiff notified the defendant’s agent that he had changed his mind, and that if any of said land was to be operated for gas and oil he desired to have the operations begun and carried on upon the tract of forty acres described as the northeast quarter of the southeast quarter of section two (2), town three (3) north, range (12) twelve east, in Wood county, Ohio.
    “That soon after receiving said notice the agent of the defendant drew other loads of derrick lumber and deposited it on the forty-acre tract so as aforesaid, first designated by the plaintiff, and was about coming on the same land with another load when the plaintiff informed him that if the defendant insisted that his said lease gave him the right to operate the whole farm, which contained 120 aches of land, in case he was successful in finding gas or oil on the premises, that he would not permit him to commence operations upon said land at all, but would enjoin him.
    “To this the agent of the defendant answered that he did not know how much land the defendant claimed a right to operate, but would write to the defendant and let the plaintiff know, and then deposited another load of lumber prepared for the purpose and intended to be used in the construction of a derrick on the land last mentioned and first designated by the plaintiff.
    “The defendant at that time claimed a right under his said lease to operate the whole farm of one hundred and twenty acres, in case he found gas or oil upon any one acre of land mentioned in the lease and designated by the plaintiff, and supposed that this right was vested in him by the terms of his lease.
    “No other work or operation had been commenced or done on said land up to the date of the commencement of this action, and nothing has been done since.
    “Upon the facts so found the court find the equity of this case to be with the defendant, George H. Van Vleck, as to the forty-acre tract, described as the southwest quarter of the northeast quarter of section two (2), town three (3) north, range twelve (12) east, in Wood county, Ohio, and with the plaintiff as to the eighty acres, constituting the balance of the tract or farm described in the petition, and that each is entitled to have his title quieted accordingly.
    ‘ ‘It is thereupon ordered, adjudged and decreed by the court that the defendant, George H. Van Vleck, have and hold the right to enter upon and operate for gas and oil upon the forty-acre tract described as the southwest quarter of the northeast quarter of section two (2), town three (3) north, of range twelve (12) east, in Wood county, Ohio, in all respects as granted and conferred b}^ the contract or oil lease set forth in defendant’s answer herein, and as claimed in said answer, free from all interference of plaintiff herein; and that as to the balance of. the tract described in plaintiff’s petition herein, the title of plaintiff thereto is quieted, and defendant is forever enjoined from asserting any rights or claims thereon by virtue of said oil lease or otherwise.
    “And it is further ordered that each party pay one-half of the costs in both courts in this case to be taxed.”
    Proper exceptions having been noted, a petition in error was filed in this court seeking to reverse the judgment of the circuit court.
    
      Dodge <& Canary, for plaintiff in error.
    
      James 0. Troup, for defendant in error.
   Btjrket, J.

Plaintiff in error urges that the contract is void as to all except the one acre, for the reason that it is said to be indefinite and ambiguous, and that there is no description of the forty acres sought to be conveyed.

In Texas it is held that a grant by the owner, of a certain number of acres in a particular tract, will authorize the grantee to locate it in any part of the tract. Wofford v. McKinna, 23 Texas, 36.

In Illinois such a description is held to be so vague and uncertain as to convey no title. Shackleford v. Bailey, 35 Ill., 391; Laflin v. Herrington, 16 Ill., 304; Hughes v. Streeter, 24 Ill., 647.

In this state at an early clay, courts undertook to carry out the intention of the parties, and. held that a deed conveying a certain number of acres out of a designated corner of a certain tract of land, was a good conveyance of that nufnber of acres in a square form out of the designated corner. And this was carried so far as to hold that a grant of fifty-one acres in the northeast part of a certain tract, was good as a conveyance of fiftjr-one acres in a square form in the northeast corner of the tract. Walsh v. Ringer, 2 Ohio, 327; Cunningham v. Harper, Wright, 366.

In Hay v. Storrs, Wright, 711, there was excepted out of a conveyance of a tract of land half an acre opposite where Mr. Harvey formerly resided. The exception was held good, and sufficiently definite to enable an officer to find and locate it. The court say: “There can be no doubt of the intention of the grantor to reserve to himself, bj^ exception from his deed, one-half an acre. Where does it lie? Find where Harvey lived- — if it be opposite the corner of the one hundred and thirty-four-acre tract, it lies in the corner, in a square form — if so far from the corner, that the lines of the half acre would not reach it in a square form, then a line from the centre of the residence of Harvey would be the centre of the half acre tract on the street, and the tract would be laid out in a square form by parallel lines, making that the base.”

Plaintiff in error owned three tracts of forty acres each, and by selecting the one acre upon which the well was to be drilled, he thereby designated that the forty-acre tract out of which the one acre was so selected should be the forty acres to be operated under said lease in case gas or oil should be obtained.

If the number of acres contracted to be operated in case gas or oil shall be found, is the same as a subdivision of a section, say 10, 20, 40, 80 or 160 acres, it will be held that the subdivision of the section upon which the well is located, is the land intended to be operated under the lease. Otherwise the land to be operated is to be taken in a square form with the well as its centre, unless the well is so near a line of the land as to make this impossible, in which case the land to be operated will be in a square form including the well, and extending- to such line.

If gas or oil is found on adjoining lands, the tract to be operated must be ascertained in the same manner in which the half acre was ascertained in Hay v. Storrs, supra.

Next, it is urged that the contract was void, and remained so to the time of the commencement of the action, for the reason that upon its face it is without consideration. The contract is expressed to be upon the consideration thereinafter stipulated and agreed upon. There are many stipulations and agreements thereinafter contained, founded however upon the contingency that oil oi-gas be found and developed upon said premises. There is also a stipulation to the effect that if operations upon said premises be not commenced within five years that the contract shall be void. There is also an agreement that if the second party shall not commence a test oil or gas well at Rising Sun or vicinity in ninety days, that the lease should be void.

So far the stipulations and agreements are contingent, but there is a further and positive agreement, to the effect that after twenty-four months' the second party will pay to the first party the sum of fifty cents per acre per year, “to be paid out of the first moneys realized or received by said second party from the development of gas or oil.” Not from the development of gas or oil on these premises, but from the development of gas or oil generally. Such a promise made by a party in the gas or oil business, is as certain as the promise of a farmer to pay out of his next year’s crops.

But aside from this agreement to pay fifty cents per acre, the contingent stipulations and agreements, with part performance and an offer of full performance before the commencement of the action, furnish ample consideration for the contract. Grant that the parties of the second part were not originally bound to commence a test oil or gas well at Rising Sun within ninety days, j^et having commenced the well within that time at that place, and in that regard performed their part of the contract, such performance is itself a sufficient and completed consideration, and thereafter the lessor cannot be heard to aver want of consideration Performance by the party not originally bound supplies the consideration, and- thereafter, the other party is as fully and firmly bound as he would have been in case there had originally been ample consideration expressed in the contract. Fishmonger's Co. v. Robertson, 5 Man. & G., 131; Phelps v. Townsend, 8 Pick., 392; Commercial Rank v. Nolan, 7 How. (Miss.), 508; 1 Parsons on Contracts, 451.

Again, it is urged that there was a lack of performance as to the drilling of the test well at Rising Sun within ninety days.

The Circuit Court found that the test well was commenced within ninety days duly drilled to completion, and the existence of oil at that point thereby ascertained, that the well was not operated, but was plugged and the casing withdrawn.

This fully complied with the terms of the contract. The lease did not stipulate for the operation of the well, and the court cannot make a better contract for the plaintiff than he made for himself. As the test well was not on plaintiff’s land, he had no interest in the profits to be derived from its operation, unless it should have been indirectly, and such indirect benefits arising from operations upon the lands of another to be available must be expressly stipulated for, as they cannot be implied.

Lastly, it is urged that under the circumstances of this case, plaintiff should have had the privilege of making a second location of the place for the drilling of the well on his land, and that as the five years had elapsed at the time of the trial, the lease had expired by its own limitation, and judgment should have been given in favor of plaintiff.

As a general rule, only one location is permitted, and we see nothing in this case to warrant a departure from this rule. The defendant had commenced acting upon the selection made, and he had a right to insist that there should be no change. If a second selection had been granted, a third might have been demanded. The Circuit Court was right in holding him to his first location.

A s to the expiration of the five years, the rule is that where a party is prevented from performing his contract by injunction wrongfully obtained, he shall at the end of the litigation have as much time in which to perform as still remained at the date of the injunction, the rights thereafter to be the same as they .would have been in case no injunction had been issued. In short, the time between the issuing of the wrongful injunction, and the ending of the litigation, is not regarded,- and cannot be counted to the detriment of the enjoined party. To hold otherwise would permit a man to profit by his own wrong. This principle has been carried so far as to estop a party from availing himself of the statute of limitations. Treasurer v. Martin, 50 Ohio St., 197.

But it is urged that as defendant in error claimed the right to operate all of the three forty acre tracts in case oil or ga.s should be found, when in fact he was entitled to operate only one of them, .that he was in the wrong in his claim, and that for aught that appears, the injunction would not have been applied for, or granted in case he had claimed only forty aeres.

The findings of fact show ¡that defendant in error did not know of this interlineation as to the forty acres, and supposed that he was entitled to the whole one hundred and twenty acres, as shown by the record. Plaintiff in error had full knowledge of the fact that only forty acres were granted, and he was first in the wrong by making his claim for an injunction too broad. Had he truly stated the facts in his petition as to the forty acres, and thus called the attention of defendant to the error in the record, it is not likely that any defense would have been made, and the well would have been drilled within the five years. The litigation and consequent delay, were therefore caused by plaintiff, in knowingly and wrongfully covering too much territory by his injunction, and not by the defense thus made without knowledge of the mistake in the record. There is therefore nothing to take the case out of the general rule in such cases.

Judgment affirmed.