Court Opinion

ID: 4004487
Source: CourtListenerOpinion
Date Created: 2016-07-06 11:05:41.701146+00
Date Added: 2024-06-11T07:44:35.561348
License: Public Domain

In support of the petition for rehearing, briefs have been filed not only by the able counsel of record for the defendant but also by other able lawyers who represent companies engaged in oil and gas development.
Counsel seem to apprehend that by this decision, we are overthrowing settled rules of property of this jurisdiction; that we are in effect overruling the cases of Wilson v. GasCo., 78 W. Va. 329, 88 S.E. 1075; Carper v. Gas Co., 78 W. Va. 433,89 S.E. 12, and Stanley v. Gas Co., 78 W. Va. 793,90 S.E. 344; that we are making it possible for a lessor, after having accepted delay rental for a definite period, to sue the lessee within that period for cancellation of the lease or for damages for failure to drill. With the greatest deference to distinguished counsel, we are unable to perceive that we are changing any rule of property, that we are overruling in any particular either of the said cases, or that by the rule employed in the instant case lessees are to be subjected to the hazard of vexatious litigation within periods covered by delay rental paid by them. In neither the Wilson, the Carper nor theStanley cases was fraudulent drainage by the lessee itself considered.
There must be kept in mind the several procedures affecting oil and gas leases. On the one hand we have actions for damages for failure to develop or for failure to off-set drainage, and suits in equity to cancel leases because of some violation *Page 846 
of covenants by the lessee. We are not dealing with situations of that kind in the instant case. On the other hand, there may be a suit by a lessor specifically to enforce on the part of the lessee the covenants, express or implied, of the contract between them. And where, as at bar, the suit is based on allegations of fraudulent drainage by the lessee, the acceptance of delay rental by the lessor does not preclude him from coming into equity even within the period for which the delay rental has been paid. Delay rental may not be employed as a cloak for fraud. Fraud vitiates everything. So, we hold simply that, such situation appearing from the pleadings at bar, the trial chancellor should decide the case on its merits.