Lima Oil & Gas Co. v. Pritchard

• Decision Date: 18 September 1923
• Docket Number: Case Number: 11728
• Citation: 1923 OK 634,92 Okla. 113,218 P. 863
• Parties: LIMA OIL & GAS CO. v. PRITCHARD.
• Court: Oklahoma Supreme Court

1923 OK 634

218 P. 863

92 Okla. 113

LIMA OIL & GAS CO. v. PRITCHARD.

Case Number: 11728

Supreme Court of Oklahoma

Decided: September 18, 1923

Syllabus

¶0 1. Army and Navy--Soldiers' and Sailors' Civil Relief Act--Not Applicable to Oil and Gas Mining Lease.

Since under the rule established in this state, an oil and gas mining lease conveys no estate in real or personal property, but merely grants a license to explore for oil and gas, section 301 of the act of Congress approved March 8, 1918 (sec. 3078 1/4f, U.S. Comp. Stat. 1918, Comp. Stat. 1919, Ann. Supp.), known as the Soldiers' and Sailors' Civil Relief Act, has no application to such a contract for the purpose of tolling the time limited therein for the performance of a condition subsequent, and where such condition subsequent is wholly unperformed, and the contract by its express terms terminates as to both parties upon such failure to perform, no action to cancel same is necessary prior to the execution of a new lease by the lessor.

2. Same--Acquirement of Record Title Subsequent to Act--Effect.

In such case where the evidence shows that plaintiff took record title to an undivided one-half interest in the lease subsequent to the passage of the act of Congress for the obvious purpose of taking advantage of the provisions of the act to delay the right of the lessor to proceed under the terms of the lease, such acquisition of record title was ineffectual for that purpose under the provisions of section 3078 1/4 qq of the same act.

3. Specific Performance -- Contracts -- Optional as to One Party.

When a contract is optional as to one party, so that a decree would be ineffectual in compelling performance by the optionee, this court will not render a judgment which in effect would be a decree for specific performance in behalf of the party not bound.

Commissioners' Opinion, Division No. 1.

Error from District Court, Nowata County; C. W. Mason, Judge.

Action by Charles S. Pritchard against Lima Oil & Gas Company, a corporation, to cancel a certain oil and gas lease. Decree for plaintiff, and defendant brings error. Reversed, with directions.

A statement of the case will be taken from the brief of defendant in error, as follows:

"On January 12, 1918, the defendant in error purchased an oil and gas mining lease from Phillip Strong, the owner of the lands covered by the lease, the consideration therefor being $ 1,000 in cash paid by defendant in error with an express condition contained in the lease to complete a well upon the land within nine months from the date thereof, and in the event of the failure of defendant in error to fulfill said condition, then the lease to become null and void as to both parties. On the date of the lease the defendant in error borrowed from Jacob Schneider the sum of $ 1,000 and paid it to the lessor, and to secure the said Jacob Schneider for said loan, executed an assignment of the lease, and the lease and the assignment were placed of record; thereafter, and on May 14, 1918, the defendant in error repaid Schneider $ 500 of said loan, and Schneider re-assigned an undivided half interest in the lease to defendant in error, retaining an undivided one-half interest as security for the remaining $ 500 of the loan still unpaid, and said re-assignment was placed of record. That prior to the purchase of said lease by defendant in error, the plaintiff in error bad acquired a lease from the same lessor upon the same lands, which lease had for failure on the part of the plaintiff in error to drill upon the lands become null and void, but was of record. That on June 4, 1918, the defendant in error, visited the offices of the plaintiff in error in Bartlesville, Okla., and there attempted to dispose of his lease, which as yet he had not developed or drilled upon, and on said visit he told the president of the plaintiff in error company that he was clearing up his affairs as best he could preparatory to entering into his military duties, and informed him that he was called and had to go into service, and offered to sell him the lease in question for what it had cost him; that no definite answer was given defendant in error by the president of said company at that time, but a few days later he called defendant in error by telephone and informed him that he had decided not to purchase the lease as offered. On this visit there was executed by the company a release of their former lease under which they had done no drilling, which was delivered to defendant in error. That between the time defendant in. error purchased said lease and his departure to enter upon his military duties he went upon the lands and determined the location of the well he had agreed to drill, and made arrangements with a brother of the lessor living in the vicinity to prepare a pond for water which he expected to use in his drilling operations. That on June 26, 1918, he was inducted into military service, was in training camps in the United States for some weeks, and then transported to France, and was in active service until April 17, 1919, when he was discharged at Camp Pike, Arkansas, and returned to his home in Nowata. That upon his arrival home, he found upon inquiry as to what had become of his lease; that while he was in service the plaintiff in error had secured another lease upon the lands from the lessor By his attorney in fact: that oil had been discovered upon an adjoining tract in November, 1918, and that said lease of plaintiff in error was taken on February 19, 1919; that plaintiff in error had taken possession of the lands, and did in June, 1919, complete a well on the same."

It was the contention of plaintiff, Pritchard, in the trial court, and is here, that by virtue of the provisions of section 301 of the act of Congress approved March 8, 1918, known as the Soldiers' and Sailors' Civil Relief Act. the condition in the lease held by him to drill a well within nine months from date thereof was rendered inoperative by his induction into the military service of the United States, and that the subsequent lease of the Lima Oil & Gas Company is null and void by reason of the operation and effect of the above section upon plaintiff's lease.

The contention of the defendant in the lower court, and here, is that plaintiff's lease expired and terminated by its own terms upon failure of plaintiff to perform the condition subsequent named therein, and that section 301 of the act of Congress approved March 8, 1918, has no application in tolling the time limited in said contract for completing a well there under and that the subsequent lease taken by the defendant company upon said lands is a valid and subsisting lease.

The parties will be hereafter referred to as plaintiff and defendant as they appeared in the trial court.

Rowland & Talbott, for plaintiff in error.

Bert Van Leuven, for defendant in error.

LOGSDON, C.

¶1 All assignments of error in this case are comprehended under two propositions, which are thus stated in defendant's brief:

"1. The statute upon which plaintiff bases the validity and subsistence of his lease is inapplicable to the facts of this case.

"(2) The failure of the trial court to require Jacob Schneider, plaintiff's co-owner of the lease, and Phillip Strong, lessor of both plaintiff and defendant, to be brought in as parties to this suit, is error for which this court will reverse the judgment."

¶2 Under the first proposition both parties devote a major portion of their briefs to a discussion of the provisions and effect of the act of Congress of March 8, 1918 (U. S. Comp. Stat. 1918, Comp. Stat. Ann. Supp. 1919, section 3078 1/4a, et seq.), known as the Soldiers' and Sailors' Civil Relief Act. Their respective contentions are the converse of each other under the proposition first above stated. A determination of these contentions involves a careful consideration and analysis of the provisions of the act involved

¶3 The 1st section of the act defines its general purpose and scope of operation to be to enable the government to more successfully prosecute the war by extending protection to those in the military service against prejudice or injury to their civil rights by temporarily suspending legal proceedings and transactions which may prejudice those rights. The 2nd section defines certain words and phrases, while the 3rd extends the act to embrace all territory subject to the jurisdiction of the United States and all proceedings commenced in any court therein.

¶4 It is thus seen that the general purpose of this legislation was the protection of the civil rights of soldiers in the interest of united effort, and its scope of operation embraced all court proceedings in all courts subject to the jurisdiction of the United States. That it was not intended to apply to extrajudicial proceedings based on contractual relations nor to impair the obligation of contracts has been held by the courts of Alabama, Massachusetts, and Minnesota. Wood v. Vogel (Ala.) 87 So. 174; Morse v. Stober (Mass.) 123 N.E. 780; Bell v. Buffinton (Mass.) 137 N.E. 287; Taylor v. McGregor State Bank (Minn.) 174 N.W. 893; Nelson Real Estate Agency v. Seeman (Minn.) 180 N.W. 227.

¶5 The 4th section extends the benefits of stay, postponement or suspension of proceedings to sureties, guarantors and indorsers in the discretion of the court. By the 5th section it is provided how default judgments may be taken, a penalty for false affidavits in connection therewith, for appointment of attorney to represent the absentee, and for vacating default judgments. By the 6th, 7th, 8th and 9th sections provisions are made for staying actions, for suspending penalties and executions, and prescribing the duration of such stays and suspensions, while the 10th section tolls statutes of limitation. The 11th section prevents eviction or distress for default in payment of rent in certain classes of cases, and authorizes allotment of pay to dependents of soldiers and sailors.

¶6 The 12th ...