[J-95-2014] 

IN THE SUPREME COURT OF PENNSYLVANIA 

MIDDLE DISTRICT 

SAYLOR, C.J., EAKIN, BAER, TODD, STEVENS, JJ. 

WAYNE HARRISON AND MARY 

HARRISON, 

Appellees 

v. 

CABOT OIL & GAS CORPORATION, 

Appellant 

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No. 75 MAP 2014 

Appeal from the U.S. Court of Appeals, 

Third Circuit No. 12-3613, Granting 

Petition for Certification of Question of 

Law 

SUBMITTED: October 8, 2014 

OPINION 

MR. CHIEF JUSTICE SAYLOR DECIDED: February 17, 2015 

We accepted certification from the United States Court of Appeals for the Third 

Circuit to address whether the primary term of an oil-and-gas lease should be equitably 

extended by the courts, where the lessor has pursued an unsuccessful lawsuit 

challenging the validity of the lease. 

The Third Circuit has related the material, undisputed facts along the following 

lines. In August 2007, Appellee Wayne Harrison entered into a lease with Appellant 

Cabot Oil & Gas Corporation, per which Cabot obtained the exclusive right to explore 

oil-and-gas resources on Mr. Harrison’s property. In exchange, the company agreed to 

pay an initial bonus plus a one-eighth royalty on oil or gas successfully produced from 

the land. The instrument carried a “primary term” of five years, but it also provided for 

an extended term “as long thereafter as oil or gas is produced . . . in paying quantities 
[J-95-2014] - 2 

from the premises[.]” See generally T.W. Phillips Gas & Oil Co. v. Jedlicka, 615 Pa. 

199, 42 A.3d 261 (2012) (discussing the “paying quantities” convention frequently 

utilized in oil-and-gas leases). Furthermore, Cabot was provided with an option to 

extend the primary term for an additional five years. 

Approximately halfway through the primary lease term, Mr. Harrison and his wife 

commenced a civil action against Cabot in a federal district court, seeking a declaration 

that the lease was invalid. Via an amended complaint, the Harrisons centered the 

litigation upon their contention that the company had fraudulently induced Mr. Harrison 

to enter into the lease via an agent’s representation that Mr. Harrison would never 

receive any more than $100 per acre as a threshold bonus payment from a gas 

producing company. The Harrisons asserted that they subsequently learned of other 

landowner-lessors receiving higher payments. 

Cabot denied the material allegations of the complaint and lodged a 

counterclaim. In this pleading, the company sought a declaratory judgment that, in the 

event the Harrisons’ suit failed, the primary term of the lease would be equitably tolled 

during the period of time during which the suit was pending, and, concomitantly, the 

lease would be extended for an equivalent period of time beyond what was provided by 

its actual terms. In support of this request, Cabot alleged that the cloud upon the lease 

created by the Harrisons’ suit had prevented the company from “prudently tak[ing] any 

steps to develop or commence operations on [Harrison’s] leasehold as allowed by the 

Lease.” Petition for Certification of Question of Law in Harrison v. Cabot Oil & Gas 

Corp., No. 12-3613, at 3 (3d Cir. Apr. 7, 2014) (citation omitted; interlineations in 

original). 

In support of its counterclaim, Cabot pointed to cases from several other oil-andgas-producing jurisdictions holding that: 1) a lessor’s commencement of a lease-validity 
[J-95-2014] - 3 

challenge constitutes an effective repudiation of the agreement; 2) the lawsuit and 

attending uncertainty renders it economically impractical for the lessee to proceed with 

the costly development of production infrastructure on the property; 3) it would be unfair 

to permit a meritless lease challenge to deprive the lessee of the benefit of its bargain, 

namely, the opportunity to establish production during a limited “window of opportunity” 

corresponding to the primary term of the lease (and thus to avoid defeasance of the 

lessee’s corporeal interest in real property); and 4) it is therefore appropriate for the 

courts to award an extension of the primary lease term, measured according to the 

length of time the unsuccessful lawsuit was pending.1 

Cabot sought summary judgment. Relative to its counterclaim, the company 

submitted a declaration from one of its land managers indicating that the cost of drilling 

 

1 See, e.g., Rougon v. Chevron, U.S.A. Inc., 575 F. Supp. 95, 100 (M.D. La. 1983) 

(“[W]here a lessor questions the validity of a lease, the term of the lease is suspended, 

the logic being that the lessee has been deprived of the exercise of the rights granted to 

him by the lease by the act of the lessor and he is therefore granted an extension 

beyond the primary term for the period during the primary term when the lease was 

placed in jeopardy.” (quoting Hanszen v. Cocke, 246 So.2d 200, 203 (La. Ct. App. 

1971))); Sw. Energy Prod. Co. v. Elkins, 374 S.W.3d 678, 685 (Ark. 2010) (“Not to toll 

Southwestern Energy’s obligation to drill as of [a particular] date would create an 

impossible dilemma for [the company]: either use the contested lands and potentially 

expose itself to more liability or refrain from using the lands and lose its investment and 

the one-year window . . . for development”); Greer v. Carter Oil Co., 25 N.E.2d 805, 810 

(Ill. 1940) (“The great weight of authority in other States holds that where the lessor 

brings suit to avoid an oil and gas lease and the litigation ends after the grant has 

expired, that the lessors are estopped to claim the lease is invalid because the term has 

expired, and that an additional period of time may be fixed by a court of equity in which 

to commence drilling operations.” (citations omitted)); cf. Kothmann v. Boley, 308 

S.W.2d 1, 4 (Tex. 1957) (directing that oil-and-gas leases were to be extended on the 

basis that “[l]essors who . . . wrongfully repudiate the lessees’ title by unqualified notice 

that the leases are forfeited or have terminated cannot complain if the latter suspend 

operations under the contract pending a determination of the controversy and will not be 

allowed to profit by their own wrong”); Bingham v. Stevenson, 420 P.2d 839, 842 (Mont. 

1966) (implementing an equitable lease extension based on actions by the lessors, 

including the transmittal of letters denying the validity of the lease). 
[J-95-2014] - 4 

and completion of a specialized well generally required to produce gas from Marcellus 

Shale in Pennsylvania is in the range of $4 to $7 million dollars. According to the land 

manager, “[t]he expense associated with such drilling and completion makes it 

particularly impractical for an oil-and-gas producer to invest in drilling, completing a well 

when there is an ongoing lawsuit regarding the validity of the oil-and-gas lease.” 

Declaration of Jeffrey Keim of Sept. 30, 2011, in Harrison v. Cabot Oil & Gas Corp., No. 

10-312 (M.D. Pa.), at ¶5. 

The district court awarded summary judgment in Cabot’s favor on the suit to 

invalidate the lease. The court, however, resolved the counterclaim in the Harrisons’ 

favor, concluding that the law of this Commonwealth does not provide for equitable 

extensions of oil and gas leases under the circumstances. See Harrison v. Cabot Oil & 

Gas Corp., 887 F. Supp. 2d 588, 596-98 (M.D. Pa. 2012). 

In reaching this conclusion, the district court relied primarily on Derrickheim Co. 

v. Brown, 305 Pa. Super. 173, 451 A.2d 477 (1982), which prioritized the terms of a 

lease over equitable considerations in a circumstance in which an oil producing 

company forewent operation of a well until a defect in the lessor’s title was resolved. 

See id. at 178, 451 A.2d at 480 (“The fact that it was ‘prudent’ for [a lessee] to suspend 

operations upon learning of [a] cloud on the title does not justify disregarding the 

express language of the lease.”). The district court took Derrickheim as a signal that 

Pennsylvania courts would reject the equitable extension practice implemented 

elsewhere. See Harrison, 887 F. Supp. 2d at 596-97. Further, the court reasoned that, 

under Pennsylvania law, the mere filing of a declaratory judgment action challenging a 

lease does not, in and of itself, comprise a repudiation of the lease such as would 

implicate judicial redress. See id. at 597 (“Until the Pennsylvania courts say otherwise, 

this Court will not find that a party’s filing of a lawsuit in federal court amounts to a 
[J-95-2014] - 5 

repudiation of a lease between the parties, despite what courts in other jurisdictions 

have held.”). 

In this regard, and more broadly, the district court relied upon a recent decision 

authored by a coordinate judge, Lauchle v. Keeton Group LLC, 768 F. Supp. 2d 757 

(M.D. Pa. 2011). The Lauchle court additionally posited that “deeming these leases to 

have been repudiated under the circumstances of this case is both bad law and even 

worse public policy,” given the superior bargaining power of oil-and-gas-producing 

companies relative to the drafting of leases, as well as the disincentive to the pursuit by 

lessors of potentially meritorious actions. Id. at 762. 

Cabot lodged an appeal in the federal intermediate appellate court, contending 

that, if presented with the question, this Court “would recognize the rule that, where a 

lessor repudiates a lease by initiating litigation seeking to invalidate the lease, the 

lessee is entitled to an equitable extension of the lease term if the lessor’s claim is 

denied.” Petition for Certification in Harrison, No. 12-3613, at 5. In support of this 

position, the company pointed to other jurisdictions which have adopted such approach. 

See supra note 1. 

Cabot also filed a motion requesting certification to this Court. See Supreme 

Court Internal Operating Procedures §8. The Third Circuit granted this request and 

applied for certification, which we accepted, recognizing that the issue was one of first 

impression and of significant public importance, given that its resolution may affect a 

large number of oil-and-gas leases in Pennsylvania. 

Presently, Cabot grounds its position squarely on the principle that a party to a 

contract is entitled to the benefit of its bargain. See, e.g., Ferrer v. Trs. of Univ. of Pa., 

573 Pa. 310, 340-41, 825 A.2d 591, 609 (2002). The company posits that, if one 
[J-95-2014] - 6 

contracting party deprives the other of a bargained-for benefit, the law should correct 

the deprivation. 

Cabot also explains that, in the last decade, with the discovery of the potentially 

vast quantities of natural gas in the Marcellus Shale reserve in Pennsylvania, and with 

the introduction of new means to make production of that natural gas more practical, 

thousands of Pennsylvania landowners have leased their property to oil-and-gas 

producers. Accord Brief for Amici Pa. Indep. Oil & Gas Ass’n, Marcellus Shale Coal., 

Chief Oil & Gas, LLC, and Sw. Energy Prod. Co. [hereinafter the “Industry Amici”] at 3 

(“While Pennsylvania was home to the first oil well in the United States more than 150 

years ago, advances in technology and discovery of the promise of the shale gas plays 

have dramatically increased the impact of the oil-and-gas industry in Pennsylvania in 

the last decade.”). According to the company, disparities in lease remunerations exist 

due to various factors, often depending upon the timing of lease consummation 

(particularly given the evolving knowledge relative to Marcellus Shale); the developing 

state of the technology; and fluctuating market conditions. Cabot suggests that such 

differences have incentivized some landowner-lessors to wrongfully contest the validity 

of oil-and-gas leases in hopes of securing the freedom to pursue more lucrative 

arrangements. 

The problem facing oil-and-gas-producing companies, Cabot contends, is that 

such lease-validity lawsuits forestall drilling and well development, given the multimillion dollar investments attending such operations. See Brief for Appellant at 16 (“It 

would be essentially impossible for a producer to place such an investment at risk while 

there remains pending a lawsuit seeking to invalidate the producer’s interest in the 

property.”); accord Brief for the Industry Amici at 6 (“[T]he expense of drilling generally, 

and especially for wells in unconventional formations such as the Marcellus Shale, is 
[J-95-2014] - 7 

too great for any reasonable production company to go forward with drilling while there 

is a pending lease challenge.”). The result, the company indicates, is that producers 

are deprived of the full benefit of their bargains by meritless lease challenges. For 

these reasons, Cabot encourages this Court to follow the mainstream approach of other 

jurisdictions which have treated a meritless lease challenge as a repudiation and 

applied equitable remedial principles. See supra note 1. Indeed, the company 

highlights, this principle has become essentially one of black-letter law, as reflected in 

several prominent treatises in the field.2 

Cabot recognizes that the issue is one of first impression in this Court. According 

to the company, however, Pennsylvania already recognizes all legal predicates to the 

equitable-extension principle. In particular, the company references the expectation 

remedy available to redress contractual breaches. See, e.g., Ferrer, 573 Pa. at 340-41, 

825 A.2d at 609. Additionally, Cabot contends, Pennsylvania law provides that a party 

repudiates a contract, and thus effectuates an essential breach, when he makes an 

unequivocal statement that he will not perform in accordance with his agreement. See, 

e.g., Jonnet Dev. Corp. v. Dietrich Indus., Inc., 316 Pa. Super. 533, 543, 463 A.2d 1026, 

1031 (1983). The company regards the Harrison’s commencement of an action as the 

equivalent of such a statement. 

 

2 See 3 PATRICK H. MARTIN & BRUCE M. KRAMER, WILLIAMS & MEYERS, OIL AND GAS LAW

§604.7 (2009) (“[C]ourts have almost universally held that when the lessor has brought 

a suit during the primary term claiming the termination of the lessee’s interest, the 

lessee, should he prevail in such action, will be entitled to a period of time extending 

beyond the expiration of the primary term to gain production.” (citations omitted)); 2 

NANCY SAINT-PAUL, SUMMERS, OIL & GAS §14:36 (2014) (“Where a lessor has repudiated 

a lease by notice or suit for cancellation for alleged breach by the lessee of his express 

or implied covenants . . ., such act of the lessor relieves the lessee of the duty to 

continue further operations until the controversy is settled and estops the lessor from 

claiming such cessation of operations by the lessee as grounds for termination of the 

lease.”). 
[J-95-2014] - 8 

In terms of the federal district courts’ reliance on Derrickheim, Cabot argues that 

such decision is irrelevant, since in that case the lessor had not commenced a lawsuit. 

In any event, the company stresses that an intermediate appellate court’s decision, 

such as Derrickheim, is in no way binding upon this Court. See, e.g., Maloney v. Valley 

Med. Facilities, Inc., 603 Pa. 399, 418–19, 984 A.2d 478, 490 (2009). Cabot also 

proceeds to challenge the Lauchle court’s public policy perspective, arguing that the 

equitable-extension principle only serves to restore an agreed-to equilibrium after a 

disruption caused by meritless litigation. Accord Brief for the Industry Amici at 2 (“While 

successful oil and gas development is inherently uncertain, [the equitable-extension 

principle] would ensure that lessors do not profit from bringing challenges to the validity 

of their leases that turn out to be without merit.”).

3

In response to Cabot’s argumentation, the Harrisons point to the reasoning of the 

federal district courts in Harrison and Lauchle. See, e.g., Brief for Appellees at 8 (“No 

Pennsylvania law has required nor even suggested that primary terms may be extended 

beyond their express period, especially given Derrickheim’s clear holding on the 

subject.”). The Harrisons also note that oil-and-gas-producing companies frequently 

enter into leases then delay drilling according to their own interests and timetables. 

Moreover, according to the Harrisons, such companies are readily capable of 

negotiating appropriate tolling provisions in connection with their leases to account for 

the prospect of delay occasioned by lessor validity challenges. See, e.g., id. at 33 

(“[G]as companies can anticipate and manage issues relating to the length of primary 

terms within the context of their business relationships through the usual modes of 

drafting and negotiation.”). 

 

3

 In addition to the noted amici submission, Cabot’s position is also supported by a 

separate amicus brief by Professor Bruce M. Kramer, who also emphasizes the weight 

of the authority supporting the equitable-extension principle. 
[J-95-2014] - 9 

Given such considerations, the Harrisons describe the equitable-extension 

principle as nothing more than a “judicial affirmative action program” for oil-and-gasproducing companies, which “abuses landowners who have done nothing other than 

exercise their legal rights.” Id. at 8-9; see also id. at 26 (“Cabot effectively seeks a 

judicially-run affirmative action program for the benefit of oil & gas companies where the 

Pennsylvania courts do not enforce contractual rights but rewrite them in the 

companies’ favor.”). Consistent with Lauchle, the Harrisons also highlight the disparate 

bargaining power of landowner-lessors as compared to such companies. See, e.g., id.

at 16 (“Lauchle expresses significant policy considerations that further militate against 

judicially extending a primary term, by highlighting the control that oil & gas companies 

exercise over lease language and the chilling effect that an extension rule would have 

on landowners’ willingness to bring meritorious challenges.”). 

The Harrisons also differ with Cabot’s position that the mere filing of a 

declaratory judgment action represents a repudiation of a lease. Again, the Harrisons 

regard the implementation of a contrary approach in the setting of oil-and-gas leases as 

an “upend[ing]” of Pennsylvania law for the “special benefit for gas companies.” Id. at 

33. 

Several landowner-lessors submitted an amici brief in support of the Harrisons’ 

essential position. See Brief for Amici Pauline Beck, Ronald J. Gulla, Margeret Henry, 

Rebecca Roter, and Anagela and William Smith [hereinafter the “Landowner-Lessor 

Amici”]. These amici also stress the differential bargaining position of oil-and-gas 

production companies versus individual landowner-lessors. Moreover, as exemplified 

by the following passage from their brief, the Landowner-Lessor Amici regard leasevalidity litigation as merely one of a number of risks encountered by oil-and-gas-
[J-95-2014] - 10 

producing companies as a prerequisite to the rich rewards which may be attained by 

those willing to accept them: 

The speculative nature of oil and gas extraction inherently 

requires the assumption of large risks . . ., and production 

companies routinely absorb the cost of a wide variety of

unsuccessful investments. They may invest millions of 

dollars in drilling and completing a well only to find that it is 

defective or “dry” and therefore must be plugged and 

abandoned. Companies may spend millions of dollars 

acquiring gas leases that they later abandon because of 

unfavorable market or regulatory conditions. They may

choose not to develop leased acreage because greater 

profits are to be had by drilling somewhere else. They also 

may choose not to invest in production while a lease 

challenge proceeds, but such business judgments are 

commonplace and do not warrant shifting the risk of litigation 

from multimillion-dollar corporations to small landowners 

such as Mr. Harrison. 

Id. at 7-8 (footnote and citations omitted). The Landowner-Lessor Amici also observe 

that Cabot has never manifested any intention of drilling in the vicinity of the Harrisons’ 

property, and thus, they regard “Cabot’s counterclaim [as] an opportunistic and 

exploitative attempt to extend the lease term until 2020, in the hope that market 

conditions will improve at the end of the decade.” Id. at 13. 

Preliminarily, we note that contractual remedies, including equitable ones, 

generally flow from a breach of an agreement. See, e.g., McShea v. City of Phila., 606 

Pa. 88, 97, 995 A.2d 334, 340 (2010) (stating the general rule that a contract-based 

action seeking judicial redress requires the plaintiff to demonstrate a material breach). 

Cabot appears to accept this principle as applicable in the present circumstances. 

Accordingly, in this respect, the company asserts that the Harrisons’ conduct in seeking 

a judicial declaration that the Cabot/Harrison lease was invalid amounted to an 

“anticipatory repudiation” of the lease. See, e.g., Brief for Appellant at 27 (“Certainly a 
[J-95-2014] - 11 

lessor that files a lawsuit asking for a judicial declaration that the lease is not valid has 

repudiated the contract.”). See generally 2401 Pa. Ave. Corp. v. Fed’n of Jewish 

Agencies of Greater Phila., 507 Pa. 166, 174, 489 A.2d 733, 737 (1985) (discussing the 

doctrine of anticipatory repudiation as giving rise to contract-based remedies, given that 

repudiation of an agreement entails an essential declaration of an intention to breach). 

The difficulty with Cabot’s position, however, is that this Court has required more 

than the mere assertion of a challenge to the validity of an agreement to demonstrate 

such repudiation. Under Pennsylvania law, anticipatory repudiation or breach requires 

an “absolute and unequivocal refusal to perform or a distinct and positive statement of 

an inability to do so.” Id. at 172, 489 A.2d at 736 (quoting McClelland v. New 

Amsterdam Cas. Co., 322 Pa. 429, 433, 185 A. 198, 200 (1936)). 

It is widely recognized, however, outside the oil-and-gas context at least, that the 

filing of declaratory judgment action merely contesting the validity or scope of an 

agreement does not entail such an unequivocal refusal to perform. See, e.g., Principal 

Life Ins. Co. v. Lawrence Rucker 2007 Ins. Trust, 674 F. Supp. 2d 562, 568 (D. Del. 

2009) (explaining that “an action for declaratory judgment does not indicate an 

unconditional refusal to comply with contractual obligations” and joining a “chorus of 

other jurisdictions in finding that . . . statements made in the context of a declaratory 

judgment action are insufficient to establish repudiation as a matter of law”).4 As related 

in the commentary to the Restatement Second of Contracts: 

 

4

 This principle is most frequently referenced in the context of insurance coverage 

disputes. See, e.g., id.; see also Seneca Ins. Co. v. Shipping Boxes I, LLC, ___ F. 

Supp. 2d ___, 2014 WL 2567158, *4 (E.D. Va. June 6, 2014) (explaining that the 

purpose of the declaratory-judgment remedy is to “guide parties in their future conduct 

in relation to each other, thereby relieving them from the risk of taking undirected action 

incident to their rights” (quoting Charlottesville Area Fitness Club Operators Ass’n v. 

Albemarle Cnty. Bd. of Sup’rs, 737 S.E.2d 1, 7 (Va. 2013))); Lincoln Nat’l Life Ins. Co. v. 

Schwarz, Civ. No. 09-03361(FLW), slip op., 2011 WL 2357828, *3 (D.N.J. June 9, 

(Scontinued) 
[J-95-2014] - 12 

Generally, a party acts at his peril if, insisting on what he 

mistakenly believes to be his rights, he refuses to perform 

his [contractual duties]. His statement is a repudiation if the 

threatened breach would, without more, have given the 

injured party a claim for damages for total breach. Modern 

procedural devices, such as the declaratory judgment, may 

be used to mitigate the harsh results that might otherwise 

result from this rule. 

Restatement (Second) of Contracts §250 cmt. d (1981) (emphasis added); accord 

Landwehr, 734 F. Supp. 2d at 169 (explaining that “a declaratory judgment action 

‘serves to set controversies at rest before they lead to repudiation of obligations’” 

(quoting Babb v. Superior Court, 479 P.2d 379, 383 (Cal. 1971) (emphasis in original)). 

Given the above, we view the controlling determination in this case as devolving 

to whether this Court will adopt a special approach to repudiation pertaining to oil-andgas leases, as a substantial number other jurisdictions would appear to have done. See 

supra note 1. We decline to do so, however. 

In the first instance, for purposes of contract law in Pennsylvania, this Court 

adamantly has reinforced the clear predicates of repudiation. See, e.g., 2401 Pa. Ave. 

Corp., 507 Pa. at 174, 489 A.2d at 737 (“[W]e reject any argument suggesting a dilution 

of our long recognized standard of an ‘absolute and unequivocal refusal to perform.’”). 

We acknowledge the high stakes involved in oil-and-gas exploration and production, as 

 

(continuedS) 

2011); Landwehr v. FDIC, 734 F. Supp. 2d 161, 169 (D.D.C. 2010) (“[N]umerous courts 

have concluded that neither the filing of a declaratory judgment action nor the 

allegations made in support of such an action can form the basis of a claim for 

anticipatory repudiation.”). The precept nonetheless flows from the clear prerequisites 

to a repudiation, see 2401 Pa. Ave. Corp., 507 Pa. at 172, 489 A.2d at 736, and thus, it 

applies more broadly. Cf. Lanyon Zinc. Co. v. Burtiss, 83 P. 989, 989-90 (Kan. 1905) 

(holding that the mere assertion of a lease-validity challenge, in the absence of an 

injunction or other interference with the operations of the lessee, was insufficient to 

justify the assertion of a court’s equitable powers to extend the lease). 
[J-95-2014] - 13 

well as the incentive to lessor-landowners to maximize payments attending the use of 

their properties. Nevertheless, we agree with the Harrisons and their amici that such 

factors do not justify a diminution of extant legal requirements or, concomitantly, a 

curtailment of the rights of landowner-lessors to obtain a judicial declaration concerning 

their rights and interests. 

Significantly, in promulgating the Declaratory Judgment Act,5 the Pennsylvania 

General Assembly implemented a remedial regime designed to “settle and to afford 

relief from uncertainty and insecurity with respect to rights, status, and other legal 

relations.” 42 Pa.C.S. §7541(a). Furthermore, the Legislature prescribed that the 

enactment was to be “liberally construed and administered,” id., in furtherance of such 

remedial aims. In our view, it would disserve the legislative objectives to treat recourse 

to such procedure, alone, as a basis for altering material provisions of the agreement in 

controversy (i.e., the lease term). Our reluctance, in this respect, is bolstered by the 

Harrisons’ observation that oil-and-gas-producing companies are free to proceed 

according to their own devices to negotiate express tolling provisions for inclusion in 

their leases. Notably, neither Cabot nor its amici offer any direct response on this point. 

Certainly, in light of the voluminous decisional law, such companies are on sufficient 

notice of the prospect for validity challenges to warrant their consideration of such 

protective measures. 

We do not foreclose that equitable relief may be available to oil-and-gasproducing companies -- subject to applicable requirements governing recourse to equity 

-- where there is an affirmative repudiation of a lease.6 Our determination is only that, 

 

5

 Act of July 9, 1976, P.L. 586, No. 142, §2 (as amended 42 Pa.C.S. §§7531-7541). 

6

 Notably, several of the decisions cited by Cabot did involve some actual refusal by 

lessors to surrender possession of leasehold premises. See, e.g., Bingham, 420 P.2d 

(Scontinued) 
[J-95-2014] - 14 

consistent with the prevailing substantive law of this Commonwealth, the mere pursuit of 

declaratory relief challenging the validity of a lease does not amount to such. 

Having answered the certified question, this matter is returned to the Third 

Circuit. 

Messrs. Justice Eakin and Baer, Madame Justice Todd and Mr. Justice Stevens 

join the opinion. 

 

(continuedS) 

at 841-42 (explaining that lessors had refused rentals and were unwilling to accept 

drilling by the lessee pursuing an equitable extension and concluding that the lessors 

therefore had “repudiated the lease by their various actions”), cited in Brief for Appellant 

at 24; Muller v. Leyendecker, 697 S.W.2d 668, 672 (Tex. Ct. App. 1985) (“[P]laintiff on 

several occasions peaceably demanded entry into and rightful possession of his lease 

premises. However, defendants refused plaintiffs’ possession of the leased premises.”), 

cited in Brief for Appellant at 22, 38. Certainly, this is not true of all (or even perhaps 

the majority) of the cases cited by Appellant. See, e.g., Greer, 25 N.E.2d at 810 (“It has 

been suggested that [the lessee] could have proceeded to drill without regard to the suit 

and should not be permitted to claim the benefit of an estoppel unless it was actually 

prevented by court order or otherwise. In the cases from foreign jurisdictions this was 

not required, and when the great loss the lessee might suffer by successfully drilling a 

well and then losing title to the land is considered, we do not think that it should be 

required.”). Our point here is that the cases, factually at least, are not homogenous, 

and that some of the factual scenarios presented may reflect a repudiation and, thus, 

could yield the potential for redress upon the application of Pennsylvania law.