Grass v. Big Creek Development Co.
| Decision Date | 02 March 1915 |
| Docket Number | 2533. |
| Citation | 84 S.E. 750,75 W.Va. 719 |
| Parties | GRASS ET AL. v. BIG CREEK DEVELOPMENT CO. |
| Court | West Virginia Supreme Court |
Submitted January 27, 1915.
Syllabus by the Court.
A declaration, though indefinite and uncertain, is not demurrable, if with reasonable certainty it states one or more good and not inconsistent causes of action. A demurrer does not lie for mere indefiniteness or duplicity. Such defects are curable under section 46, c. 130, Code 1913 (sec 4903).
A defect in a declaration which cannot be regarded on demurrer is, by section 3, c. 134, Code 1913 (sec. 4977), cured after verdict.
Answers to special interrogatories inconsistent with the general verdict will control.
A verdict on evidence furnishing no reasonably accurate foundation for computation of damages resulting from breach of contract cannot serve as a basis for a judgment thereon.
Where no definite basis is available for the ascertainment of damages for breach of the implied covenants of an oil and gas lease, the best evidence which the circumstances will permit is all the law requires.
The owner of a lease for the production of oil and gas containing the usual terms and conditions, must, if either mineral is found in paying quantities on the lands, exercise due and reasonable diligence in prosecuting operations thereunder for the mutual benefit of himself and his lessor and, if he unreasonably fails or refuses so to do, damages therefor are recoverable against him in an appropriate action at law.
The judgment of an operator of such lease, as to the diligence with which and extent to which wells should be drilled thereunder, upon discovery of either mineral in paying quantities, will control, if exercised in good faith and not unreasonably or arbitrarily to promote his own peculiar benefit, to the manifest prejudice of the lessor. Both are bound by that degree of diligence which, surrounding circumstances and conditions being considered, would reasonably be expected of operators of ordinary prudence experienced and engaged in the same business, having due regard for the interests and advantage of themselves and their lessors.
To entitle him to damages for unreasonable or arbitrary evasion of implied covenants of an oil and gas lease, nothing therein preventing, for diligent prosecution of operations, either mineral being found in paying quantities on the premises, plaintiff assumes the burden of showing, and by clear and convincing proof must to avail him show, by witnesses having experience and skill and engaged in similar operations, that the lessee, having due regard for the advantage and profit of himself and lessor, has not, surrounding circumstances and conditions being considered, exercised ordinary diligence in conducting such operations. If he has, plaintiff cannot recover.
Among such circumstances and conditions are the situation of the parties; the character of the mineral products; the nature of the oil-bearing sand, whether dense or soft and porous; developments on contiguous lands, whether by same or different operators; cost of drilling; proximity to market, and facilities for marketing; current prices, whether high or low; location of the lands; and such other conditions attendant upon the operations as may explain necessity for prompt, or excuse for delayed, action in prosecuting such developments. And if, considering these, the operator has exercised that reasonable diligence and sound, practical judgment common to and exercised by operators of ordinary prudence and experience in the same business under the same or similar circumstances and conditions, plaintiff cannot recover.
Error to Circuit Court, Lincoln County.
Action by John M. Grass and others against the Big Creek Development Company. Judgment for plaintiffs, and defendant brings error. Reversed, and new trial granted.
Vinson & Thompson and F. C. Leftwich, all of Huntington, for plaintiff in error.
Neal & Strickling, of Huntington, D. E. Wilkinson, of Hamlin, and Campbell, Brown & Davis, of Huntington, for defendants in error.
Of a judgment for $7,000, rendered upon the verdict of a jury in an action of assumpsit brought by John M. Grass, defendant Big Creek Development Company complains on writ of error.
In July, 1907, Grass as owner leased 100 acres of land to C. H. Freeman for the sole purpose of mining and operating for oil and gas, the consideration being a cash payment of $100, one-eighth of the oil produced, and $200 annually for each gas well the product from which should be marketed and used off the premises. As Freeman's assignee, defendant soon thereafter entered upon the premises and drilled four wells producing oil in paying quantities, locating them so as to operate as offsets to wells previously drilled on contiguous lands producing oil in like quantities. Deeming the four wells insufficient, under the implied covenants of the lease, for the full development of the lands for oil and ample protection from drainage through wells operated on neighboring lands, defendant operating both tracts under similar leases, plaintiffs instituted this proceeding, averring, or attempting to aver, in an original and amended declaration of one count each, two causes of action; one the breach of an implied covenant to protect against drainage, and one the breach of a like covenant for the exercise of reasonable diligence in prosecuting developments necessary for extraction of all oil contained within plaintiff's lands. To these declarations defendant tendered its demurrer, assigning as grounds therefor indefiniteness and uncertainty in the statement of the causes of action, and the joinder of two causes in the same count; and of the court's action thereon it complains.
The sufficiency of a declaration indefinitely stating a good cause of action cannot, with us, be tested by demurrer, but only by a demand for a bill of particulars containing a more specific statement of the cause imperfectly averred as the basis for recovery. Section 46, c. 130, Code (sec. 4903); Clarke v. Railroad Co., 39 W.Va. 733, 742, 20 S.E. 696; Transportation Co. v. Oil Co., 50 W.Va. 612, 40 S.E. 591, 56 L.R.A. 804, 88 Am.St.Rep. 895; Jacobs v. Williams, 67 W.Va. 377, 380, 67 S.E. 1113; Gartin v. Coal & Coke Co., 72 W.Va. 405, 78 S.E. 673. Defendant, however, made no motion for an order requiring a specification of the particulars in which plaintiffs claimed defendant had failed to comply with the duties alleged to be so imperfectly assigned. It relied solely on its general demurrer.
Neither declaration definitely distinguishes between the breaches averred or the damages severally attributed to them. The most each pleading attempted was merely a statement of the implied covenants of the lease, and defendant's failure to perform them, whereby plaintiffs suffered damage in the amount stated in the ad damnum clauses. Nevertheless it cannot reasonably be said they are insufficient to impart adequate notice of the causes assigned as the basis of the action; for, while the rules of good pleading require certainty in the averment of the material facts relied on, only such circumstantial accuracy is necessary as will reasonably afford notice of what is intended to be proved. Certainty to a common intent is all that is required. If intelligible to a person of ordinary understanding, and sufficient to afford him, the court, and the jury the means of determining what is intended, the pleading is sufficient. Moreover, in respect of matters peculiarly within the knowledge of defendant, he cannot be heard to complain, unless the averments are so uncertain as not to disclose the essential elements of the cause of action he is required to answer, or are so vague and indefinite that they cannot be said to state any cause of action sufficient to warrant a recovery. 31 Cyc. 72, 282; Railroad Co. v. Lawrence, 169 Ind. 319, 79 N.E. 363, 82 N.E. 768; Railroad Co. v. Tyree, 110 Va. 38, 65 S.E. 500; Transportation Co. v. Oil Co., supra; Clarke v. Railroad Co., supra.
Nor can duplicity in a pleading, that being defendant's second ground of demurrer, be reached in any manner except as provided by section 46, c. 130, Code (sec. 4903), unless, as in Knotts v. McGregor, 47 W.Va. 566, 35 S.E. 899, there is a misjoinder of two inconsistent causes of action. There plaintiff sued for damages occasioned by breaches of the implied covenant for quiet enjoyment of leased premises--one by the testator, one by his executrix after his death. That case holds that, unless plaintiff amends his pleading by striking one or more counts from his declaration, or elects to proceed only on one assignment of the breaches averred in one count, a demurrer will lie to such declaration as a whole or to any of its counts. Generally, however, duplicity is a defect in form only, and could be taken advantage of at the common law only by special demurrer, now abolished with us by section 29, c. 125, Code (sec. 4783); Coyle v. Railroad Co., 11 W.Va. 94; Sweeney v. Baker, 13 W.Va. 158, 200, 31 Am.Rep. 757; Poling v. Maddox, 41 W.Va. 780, 786, 24 S.E. 999; Martin v. Railroad Co., 48 W.Va. 542, 37 S.E. 563; Gartin v. Coal & Coke Co., supra.
Evidently in the original and to some extent in the amended declaration, the pleader's main object was recovery for drainage; and the trial of the case seems to have proceeded as if that were the sole purpose of the action. Both do aver existence of the two implied covenants for diligent operation and for protection from drainage, and defendant's breach of each of them. But, in the original declaration, the duty requiring diligence in development is merely incidentally stated. The charge made in it is that "there has been drawn from under the lands of these plaintiffs"...
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