Court Opinion

ID: 6279752
Source: CourtListenerOpinion
Date Created: 2022-02-18 16:12:13.417199+00
Date Added: 2024-06-11T09:00:10.020125
License: Public Domain

Opinion by
Kephart, J.,
The appellee is the owner of the Pittsburgh seam of coal underlying the surface of a piece of land for which the appellant has a lease for oil and gas. Appellee’s title was acquired prior to the appellant’s, and the appellee, under its deed, had the right to mine out all the coal conveyed without liability for damage to the surface. The bill in this case was filed to prevent interference with the drilling for oil and gas, to define the fair terms upon which the drilling might be done to pre*381serve the rights of all parties, and to recover damages for destroying the plaintiff’s well. The court below dismissed the bill. It is conceded that the appellant has the legal right to drill through the coal to reach oil and gas beneath. “We have already seen that when the owner of the surface parted with the underlying coal he parted with nothing but the coal. He gave no title to any of the strata underlying it, and it is not to be supposed for a moment that the grantor parted with or intended to part with his right of access to it. We are of the opinion that he has such right of access”: Chartiers Block Coal Co. v. Mellon, 152 Pa. 286-298. The court below, conceding the general proposition, bases its action for refusing equitable relief on the ground that there was not sufficient effort made by the appellant to agree with the appellee on the site of -the proposed well.
No notice, except such notice as might come from the occupation of a piece of land, was given to the appellee of the intention to drill for oil and gas by the appellant. On October 18th, Mr. Cameron, general superintendent of the Westmoreland Coal Company, requested the representative of the appellant to submit a blue print giving the location of the proposed well to be drilled on the Brinker tract, and to state by letter how it was to be drilled. This request was immediately complied with by a letter fully explaining the proposed drilling, but the Westmoreland Coal Company was not the owner of this tract of land and the appellant could have ascertained who owned the land. Believing that the Westmoreland Coal Company owned the land, the appellant, without any further effort to ascertain ownership, proceeded to complete the erection of the derrick it had started. This was accomplished about December 23d. Three days before that date a notice was received from the appellee ordering the drilling to cease at the place then being drilled as the well would pass through the active workings of its mines, and if the drilling was persisted in it would be prevented. Appellant promptly *382replied to this letter, enclosing a copy of the correspondence with the Westmoreland Coal Company, with a blue print showing the location of the well, and stating: “If, however, it was your understanding that the drilling of the well at that place would be through an opening, we are ready and willing to change the location so that it will be drilled through the body of the coal, but think that under the correspondence we had with the Westmoreland Coal Company, with which company we infer your company is connected, this change of location should not be made at our expense,” the letter suggesting that if there were any objections to the manner of drilling, the appellant should be notified. Not receiving any reply, the appellant proceeded with its work until the 4th of February, when the well, drilled to about twelve feet below the bed of the coal, was filled by the appellee with iron to the level of the mine. The court found that the location selected was not safe and. should be changed, and in this view of the case, which must have been known to the appellant, it was hardly justified in asking that the appellee should pay the expense of the change of location. While the letter may have called for a reply from the appellee, its absence was not sufficient, without additional effort, to justify further drilling, in view of the reason given by the appellee. The main objection was that the well was too near the active workings of the mine, and there was a possibility that it might be destroyed by a “creep” in the mine. This “creep” was discovered south of a block of coal. This block extended two hundred feet in width and seven hundred and fifty feet in length; it was approximately seven acres of coal. It had been left standing to protect the northern part of the mine. The well had been drilled in the northern part of this block. Beyond it, the coal had been mined out, and the roof had fallen at a point about one hundred and fifty feet from the. place where the well was drilled. This break could be seen on the surface. Two butt ends had been driven *383into this block of coal and in some of the workings roof falls had been noticed. Some of the witnesses testified that sixty-five per cent, of this coal was mineable, while others stated that to remove any of the coal would be exceedingly dangerous. It seemed to be the purpose of the appellee to have the appellant locate its well within this seven acres and to pay for four acres of so-called mineable coal at the rate of $2,000 per acre. All the witnesses agreed that a piece of coal two hundred feet square would amply protect the casing of the well from the “creep”; but as thirty-five per cent, of the coal could not be mined out because of the “creep,” it would be unreasonable, if the well had been located therein to require them to pay for the coal under these conditions. The appellee could very easily specify what portion of the coal it proposed to leave stand, and the appellant could sink its well in the part remaining. It is possible when the appellant reaches the supposed gas-bearing strata, it may not find gas. It would then be unfair to require it to pay a large sum of money, or any sum of money, for any coal that might surround the pipe. We do not wish to be understood as saying that it is absolutely necessary to leave mineable coal around a gas pipe to protect it, or where the court determines that it is necessary that the owner should not be compensated for that coal. There may be cases where such precaution would be necessai’y, although of the five thousand or more wells that were testified to as having been drilled through coal measures, all the witnesses admitted that there has been no report of loss of life or accident through the escaping of gas occasioned by these wells; and many have been drilled through the mined-out portions of the territory. The extent of mining on the east and west of the seven-acre tract was not developed as the main haulage ways were along these sides of this tract.
The right to drill for oil or gas is a property right not dependent on the will or caprice of the owner of the in*384termediate strata of coal or ore; it is to be exercised with due regard for the rights and safety of those who may be affected thereby. Like every other right, the exercise of which may result in the taking or jeopards izing the property of another, or is reasonably danger^ ous to life, courts of equity may and will 'regulate and control the exercise of such right by establishing safeguards as the circumstances require; so that its owner may not be deprived of the value of his right or that others who are brought in contact with it will not be unnecessarily injured or threatened with injury. We agree with the conclusion that the demands of the appellee were unreasonable. All through the case, from the evidence, it stood on its supposed right of preventing any drilling whatever by the appellant.
, The court correctly stated the law that the “lessees have the right to bore through the coal or the mined-out portions of the coal in order to reach the oil or gas below the coal strata, but that in doing the drilling for this purpose, the rights of the coal owner must be properly observed, and the golden rule of business kept constantly in mind.” The location of the well should have been the subject of an amicable agreement, if possible, and when the parties failed to agree, it then became a matter within the sound discretion of the chancellor, to be designated with due regard to the rights of both parties. While the Supreme Court in the case of Chartiers Block Coal Co. v. Mellon, supra, was not willing to hold that the location of the well could be determined by a chancellor within the equitable powers of the court, stating as their belief it was for the legislature to enact some method whereby a site might be selected, yet for twenty-five years the legislature has failed to act and during that time the lower courts have, Avithin their equitable poAVers, made the selection. The appellant does not object to this, and as it has a legal right to drill through the coal, we see no reason why a court of equity should not enforce it. The procedure adopted by the *385court below in the case of Chartiers Block Coal Co. v. Mellon, supra, appears to be equitable. Where it appeared that some damage might follow, a bond to indemnify against loss was required. As we said above, these are matters within the discretion of the chancellor.
While the appellant did not make a proper effort to agree with the appellee on the location, some effort was máde and it should not be forced to institute a new action when all lights may be adjudicated in the present proceeding. The appellant does not lose such right to relief because it did not select one of the several blocks of unmined coal offered by the appellee. That offer should be taken in connection with the testimony as to the value placed on the coal; it was indefinite and required the action of the court before it could have been accepted.
The decree of the court below is modified in that the bill is reinstated and leave is given to the appellant, within sixty days, to endeavor to agree with the appellee upon the fair terms and the place where the drilling might be done, and if the parties are unable to agree, the appellant may present the matter to the court below, who shall, from this testimony, determine the location and the fair terms upon which the well might be drilled. In the event of the failure of the appellant to make any effort to agree with the appellee as indicated herein, then the bill to be dismissed, and the decree of the court below as thus modified is affirmed at the cost of the appellant.