Court Opinion

ID: 3809553
Source: CourtListenerOpinion
Date Created: 2016-07-06 07:48:45.947348+00
Date Added: 2024-06-11T07:38:10.173231
License: Public Domain

It is my view that the quoted clause is not ambiguous, and hence rules of construction do not come into play. The clause clearly refers only to the reason for which, not to the time
during which, a forfeiture may be declared. By the majority opinion, this court first declares a plain clause to be ambiguous and then construes it entirely too strictly. In effect, the court rewrites the clause and makes a better contract for the present owners, who acquired the property with constructive notice of the lease, than the former owners made, for which they received an unusually large bonus of $25,840, or nearly $200 per acre, and an unusually large annual rental of $4 per acre. There is no showing that the original lessors ever contended for the construction urged by the present owners and adopted by the majority opinion.
It is clear that clauses in oil and gas leases abrogating or limiting covenants usually implied in oil and gas leases are valid where, as in Oklahoma, there is no constitutional provision, statute, or judicial decision establishing a contrary public policy (Eastern Oil Co. v. Beatty,71 Okla. 275, 177 P. 104; Central States 'Production Corp. v. Jordan,184 Okla. 262, 86 P.2d 790; Summers' Oil  Gas (Perm. Ed.) § 397; 24 Am. Jur. 549; 50 C. J. 858), and it logically follows that clauses which waive the remedy of forfeiture for breach of such covenants, as here, are also valid, despite the intimation in the majority opinion that 15 O. S. 1941 § 216 may render such clauses invalid. Such clauses, while subject to strict construction against the lessee in case of ambiguity, will be given effect in the absence of fraud or bad faith on the part of the lessee in delaying or refusing development. Merrill, Covenants Implied in Oil and Gas Leases (2nd Ed.) §§ 5, 6, 65, 199-203. Here no fraud or bad faith in delaying development is charged or established.
For the foregoing reasons, I respectfully dissent.
The Chief Justice and Mr. Justice WELCH concur in these views. *Page 666