Powell v. Schoenfeld

Opinion by Mr. Justice Frazer, On February 15, 1913, Levi Campbell leased to W. V. Powell, one of the plaintiffs, for oil and gas purposes, a forty-acre tract of land situated in Butler County. The lease, which was subsequently assigned to plaintiffs, was for a term of two years and so long thereafter as oil or gas in paying quantities was produced from the premises, operations to begin within sixty days, with a quarterly rental to be paid until work was commenced. The rental was paid January 5, 1915, no well having been drilled to that time; the lease expired February 15,1915, by virtue of its terms, unless the matters hereinafter considered are accepted as a compliance with the condition requiring gas or oil to be produced in paying quantities within the time specified. Campbell, the lessor, died December 31, 1914, and, on September 30, 1916, his heirs executed to defendant a lease for sixty acres for oil and gas purposes which included the tract leased to Powell. Plaintiffs then brought ejectment, claiming their lease was still in force by reason of the completion, since August, 1914, of a well drilled by them on property held under a lease from an adjoining owner, which was found, in fact, to be within the line of the Campbell property, and further that lessors, by their acts in claiming the well as being on their property, were estopped from declaring the lease forfeited because of failure to comply with its conditions. A verdict for plaintiffs was returned by the jury and a subsequent motion for judgment for defendant non obstante veredicto was dismissed. From the judgment entered on the verdict defendant appealed. [591] On June 23,1913, Ella Smith, the owner of an adjoining tract of land, made a lease of the property to Powell, which was later assigned to plaintiffs, for oil and gas purposes, and in August, 1914, plaintiffs completed a well which has produced oil in paying quantities to the present time. A royalty on the production was paid to Mrs. Smith from the time oil was obtained until the latter part of 1914. The well was located a few feet from a fence which for a period of many years had been looked upon as the dividing line between the Campbell and Smith farms. In the latter part of November, 1914, an attorney for Campbell, the lessor, notified Powell, the original lessee, that the well assumed to have been drilled on the Smith farm was, in fact, located within the lines' of the Campbell property. On December 8, 1914, Campbell went on the ground with a surveyor for the purpose of determining the exact location of the division line between the two farms and surveyed the property, which survey when subsequently completed showed the well to be, in fact, located on the Campbell tract and within about seven feet of the Smith line. The first assignment of error is to the testimony of. W. Y. Powell, one of the plaintiffs, received under objection, concerning his conversations with J. W. Hutchison, Esq., attorney for Campbell, in which Powell testified Campbell claimed the royalty from the well as belonging to him and in effect accepted the well as a compliance with the conditions of the lease. The admission of this testimony was error. Upon the death of Campbell his interest passed to his heirs through whom defendant claimed by virtue of his lease. The subject-matter of the controversy was the lease between Powell and Campbell and on the death of the latter, the former, under See. 5, clause e, of the Act of May 23, 1887, P. L. 158, became incompetent to testify as to matters occurring before Campbell’s death: Duffield v. Hue et al., 129 Pa. 94; Sutherland v. Boss, 140 Pa. 379. [592] Although the case must be reversed because of improper admission of the testimony above referred to, judgment cannot be entered for defendant non obstante veredicto for the reason other evidence appears, aside from the incompetent testimony of Powell, from which the jury might infer the well in question was accepted by deceased or his heirs as performance of the conditions of the lease held by plaintiffs, and a waiver upon their part of the necessity of drilling an additional well. Levi Campbell accompanied the surveyor to the land and pointed out the line surveyed and marked in such position as to locate the well within the boundary of the land leased by him to Powell. Samuel Campbell, one of the heirs of Levi Campbell, was also present and assisted in the survey which located the well on the Campbell tract; no demand, however, was subsequently made by him or any of the heirs, that plaintiffs proceed to drill a second well in compliance with the requirements of their lease, although they were aware plaintiffs were relying upon the well as being a fulfilment of their obligation and had ceased to pay royalties to Mrs. Smith. There also is evidence of negotiations for settlement of the dispute between the adjoining land owners, and a suggestion by Mrs. Smith that a well be drilled on her land in lieu of the existing one. On the whole, the evidence is sufficient, if believed by the jury, to warrant the con-' elusion that the Campbell heirs had waived the drilling of an additional well upon discovering the one in dispute was, in fact, located on their land, in which case they would be estopped from declaring a forfeiture without due notice to plaintiffs The judgment is reversed with a venire facias de novo.,