Court Opinion

ID: 9668963
Source: CourtListenerOpinion
Date Created: 2023-08-24 02:34:23.150687+00
Date Added: 2024-06-11T18:15:50.636996
License: Public Domain

George Rose Smith, J., on rehearing. In asking for a rehearing Feldt & Maytag insist that they have a valid title to a one-eighth interest in the minerals (or at least in the oil) despite the payment of taxes by the Hays and Newton heirs. The argument is to this effect: In 1919 Charles Richardson executed an oil, gas, and mineral lease upon his 240 acres, reserving a one-eighth royalty in all oil produced by the lessee. In 1921 the lessee drilled a producing oil well upon a different forty-acre tract from the one involved in this case, and oil has been produced from that well ever since. In 1957 the Richardson heirs conveyed a one-eighth interest in the minerals to Feldt & Maytag. It is now contended that the continuing production of oil from one forty-acre tract in the lease had the effect of vesting in the lessee constructive possession of all the minerals (or perhaps of all the oil) throughout the 240 acres covered by the lease. This constructive possession would, it is argued, inure to the benefit of the Richardsons as lessors. Hence, the -appellants say, the Hays-Newton tax payments could not amount to constructive possession of the Richardsons’ one-eighth mineral interest, for the Richardsons already had constructive possession by reason of their lessee’s production upon an adjacent forty. We are unable to agree with the basic premise in the appellants’ argument, that a lessee’s production of oil from one tract within a lease amounts to constructive possession of all the oil throughout the leasehold. This view was recently taken in Kentucky, Diederich v. Ware, Ky., 288 S. W. 2d 643, but we regard the contrary decisions as sound. Sanford v. Alabama Power Co., 256 Ala. 280, 54 So. 2d 562; Piney Oil & Gas Co. v. Scott, 528 Ky. 51, 79 S. W. 2d 394; Davis v. Federal Land Bank, 219 N. C. 248, 13 S. E. 2d 417; Dartmouth, Earl, v. Spittle, 24 Law Times N. S. 67. Our present conclusion is in harmony with our holding in Brizzolara v. Powell, 214 Ark. 870, 218 S. W. 2d 728, and, by analogy, with the rule that the lessee’s development of part of the leasehold does not excuse his failure to develop the rest. Ezzell v. Oil Associates, 180 Ark. 802, 22 S. W. 2d 1015; Standard Oil Co. v. Giller, 183 Ark. 776, 38 S. W. 2d 766. Both the petition for rehearing filed by Feldt & Maytag and that filed by the Hays-Newton heirs are denied.