Mendenhall v. Klinck

By the Court, Greoege G. Barnard, P. J. The determination of this case depends upon the construction to be given to a written agreement. The defendant owned lands in the state of Virginia, which contained coal, and was supposed to contain petroleum oil. On the 31st of October, 1863, the defendant executed the writing .in question, and delivered the same to Eli Thayer and Peter P. Todd. By this paper the defendant agreed that they might explore, bore, or in any manner test about four hundred and fifty eight acres of land described in the pleadings, for oil, and agreeing also, “ in case they find oil or are satisfied there is any there,” at any time between the date of the paper and the 1st of July, 1864, he would grant a lease for one fourth of the net profits of all oil taken therefrom, or for one fourth of the stock, if any company should be formed. The agreement provided, further, that the boring should be commenced by them as soon as they conveniently could, “ and they shall bore at least three hundred and eighty feet on said premises, in áddition to the boring already done thereon, unless they find oil nearer the surface.” [639] [New York General Term, January 6, 1868. The contract was evidently made with reference to a discovery of oil sufficient to warrant the establishment of a paying oil business. The defendant’s compensation for his lands was to be derived from no other source. The discovery of oil in sufficient quantities to warrant undertaking the business was a condition precedent to the execution of the lease by the defendant. Although.the agreement seems to make the giving of the lease dependent only upon the fact that the explorers were to be satisfied, yet effect must be given to the agreement that the testing of the lands is to-be forthwith commenced, and to be continued to a specified depth, unless the required amount of oil is found nearer the surface. This agreement is in no sense a condition subsequent. As I read the contract, it was designed as a protection to the defendant, and was to be performed before he parted with his land. Neither the plaintiff, nor his assignors have performed this condition, and they are not therefore entitled to a specific performance of the agreement. The judgment should be reversed, and a new trial granted; costs to abide the event. • George G. Barnard, Ingraham and Sutherland, Justices.]