Zachmeier v. Oil Exploration Co.

• Decision Date: 19 April 1956
• Docket Number: No. 7536,7536
• Court: North Dakota Supreme Court
• Parties: Harry ZACHMEIER and Mike Wetch, doing business under the firm name of Zachmeier & Wetch, a partnership, Appellants, v. OIL EXPLORATION COMPANY, a domestic Corporation, Respondent.

Page 533

76 N.W.2d 533

Harry ZACHMEIER and Mike Wetch, doing business under the

firm name of Zachmeier & Wetch, a partnership, Appellants, v. OIL EXPLORATION COMPANY, a domestic Corporation,

Respondent.

No. 7536.

Supreme Court of North Dakota.

April 19, 1956.

Syllabus by the Court.

1. There is a strong presumption in favor of an order granting a new trial on the ground of insufficiency of the evidence to support the verdict, and the order will not be disturbed in the absence of clear showing that there was an abuse of discretion in granting it.

2. In the instant case it is held, for reasons stated in the opinion, that there was not an abuse of discretion by the trial court in granting a new trial.

Lord, Ulmer & Murphy, Mandan, for appellants.

Shaft, Benson & Shaft, Grand Forks, for respondent.

SATHRE, Judge.

Plaintiffs, a partnership, bring this action against the defendant, a corporation, to recover damages alleged to have been sustained by reason of breach by defendant of a certain contract entered into by the parties, plaintiffs' exhibit 2.

The plaintiffs are engaged in the business of drilling oil wells. On July 8, 1954, the plaintiffs and defendant entered into a contract whereby the plaintiffs agreed to drill a well for the defendant at a designated location in Nelson County, North Dakota. By the terms of the contract the plaintiffs agreed to move to the designated location a rotary drilling rig, in good condition, and forthwith commence the drilling of said well; and to furnish all labor, tools, fuel and all necessary supplies, material and equipment for the actual drilling and to run 8 inch casing as surface casing down to 200 feet and cement at defendant's expense. The defendant agreed to pay for all surface casing and all other casing and to furnish all cement for cementing surface casing, and any casing to be set for testing or production of either oil or gas, and for plugging the well, slush pits, electric log and other special services. The plaintiffs agreed to drill the well to a depth of 3,000 feet, unless granite or other impervious formations were first encountered, or unless oil or gas in commercial quantities were found at a lesser depth; actual drilling was to be commenced on or before July 20, 1954. The defendant agreed to pay plaintiffs for their services at the rate of $12.50 per hour, standby time at $6.25 per hour; for shutdown time of 72 hours required for cement to set after casing is run and cemented, $100 for each 24 hours, total not to exceed $300. Other conditions were to be performed by the respective parties but it is not necessary to recite them here.

The plaintiffs contend that they had fully performed all the conditions of the contract by them to be performed, and that under the terms of the contract they had earned the sum of $6,900; that there had been paid thereon the sum of $3,062.50 leaving a balance of $3,837.50, for which judgment is demanded.

The defendant answered admitting that it entered into the contract as alleged by the plaintiffs, but denies specifically any breach on its part, and on the contrary alleges that the plaintiffs have wholly failed to perform the stipulations and agreements by them to be performed, and by way of counterclaim alleges that it is entitled to recover the sum of $3,062.50 paid to the plaintiffs and other items paid the plaintiffs in the sum of $741.89; and in addition thereto the sum of $5,000 claimed to be damages sustained by the defendant by reason of plaintiffs' failure to perform the conditions by them to be performed under the terms of said contract.

The case was tried in the district court of Grand Forks County, to the court and a jury. The jury returned a verdict in favor of the plaintiffs. The defendant in due course made a motion for judgment notwithstanding the verdict, or in the alternative for a new trial. The trial court denied the motion for judgment notwithstanding the verdict but granted the motion for a new trial. The plaintiffs appealed from the order granting a new trial.

The following facts are established by the record. The plaintiffs drilled to a depth of approximately 1,640 feet. At that point they struck a porous formation and an empty space or cavity which resulted in the loss of circulation, that is the mud and water that circulate and carry the cuttings back to the surface were absorbed by the porous formation. By changing the consistency of the mud used to bring the cuttings to the surface circulation was restored; but it was lost after reaching a depth of approximately 1,650 feet. The plaintiffs contended that in order to continue drilling it would be necessary to drill from 30 to 50 feet through rock below the empty space or cavity encountered, and then sink casing the whole depth so as to permit drilling inside the casing. The plaintiffs contend that it was the duty of defendant to furnish the casing, but that it refused to do so. The plaintiffs contended further that they could not drill through the rock with their...