Boal v. Citizens' Natural Gas Co.

Opinion by Rice, P. J., This action of assumpsit was brought to recover damages for the breach of a covenant in a lease, for the term of twent)rone years from June 15, 1887, “ for the sole and only purpose of drilling and operating for petroleum oil or gas,” executed by the plaintiff as lessor and the defendant as lessee. The lease is set forth at length in the opinion of the learned judge below. We need only refer to a few of its provisions. The lessee covenanted to deliver in pipe line to the credit of the lessor the one-eighth part of the petroleum oil discovered and produced on the premises; also “ if gas is obtained ” to pay to the lessor for each well drilled “ one dollar per pound for each pound pressure per annum, payable within sixty days after completion of such well.” The covenant sued upon is at the end of the lease and reads as follows : “ As additional rental it is further agreed that said party of the second part shall furnish and deliver free of cost unto the parties of the first part from and after July 1, 1887, and during the term of this lease, sufficient natural gas for heat and light, for use upon the residence premises in said borough of said parties of the first part.” It is averred in the statement of claim, and not denied in the affidavit of defense, that the defendant furnished the plaintiff'with gas until November 1,1899, at which time it was shut off from the plaintiff’s residence. He claims to recover in this suit the amount that he necessarily expended for gas to heat and light his premises, obtained elsewhere, during the three succeeding months. It is averred in the affidavit of defense that the defendant drilled one well upon the premises and marketed gas produced therefrom until some time prior to October 31, 1899, “ when the volume and pressure of the gas in said well decreased to such an extent that the defendant was unable to [344] obtain any gas from said well, and has never since obtained any gas therefrom, or had any beneficial enjoyment of said premises. The defendant has never discovered or produced any petroleum oil on or out of said premises.” The lease contains no forfeiture clause, and no clause as to the number or depth of wells to be drilled or as to the time when operations were to begin, or as to finding oil or gas in paying quantities, and no release, surrender, forfeiture or eviction is alleged. It is to be observed further, that the lease contains no stipulation, and nothing from which it can be implied, that the gas to be furnished to the lessor for use at his residence was to be produced from the leased premises. So that, even if it were averred, which it is not, that the gas upon the leased premises is exhausted, impossibility of performance of the covenant could not be set up as a defense to the present action. As we view the case, the simple question of law raised by the affidavit is, whether it was within the power of the lessee to discharge itself from the obligation of the covenant by ceasing its operations when the production of gas from the single well it drilled ceased. To state the question is to answer it. To hold that the facts set up in the affidavit constitute a defense, we must assume that the parties intended to make the obligation to furnish gas contingent upon the production by the lessee of oil oi-gas from the leased premises. It is not so written in the lease; nor is such condition, either precedent or subsequent, to be implied from the mere fact that the premises were leased “ for the sole and only purpose of drilling and operating for petroleum oil or gas.” For aught we know, the mere demise for such purpose with the privileges it conferred may have been deemed by the lessee, and may have been, in fact, an adequate consideration for its covenant to furnish gas from the date mentioned to the end of the term. There is nothing unconscionable in such an agreement, and it would be neither inequitable nor unjust to hold the lessee to it, even after it became unprofitable for the lessee to continue its operations and accordingly discontinued them. The construction contended for by the appellant is not only unsupported by any affirmative language in the lease, but it is negatived by the fact that the lessee was to begin furnishing gas within fifteen-days after the lease was executed. Surely the lessee could [345] not postpone performance of this duty by postponing its operations. Neither could it terminate nor suspend its obligation by ceasing or suspending operations, after drilling a single well and operating it to exhaustion. The case is plainly distinguishable from Williams v. Guffy, 178 Pa. 342, and McConnell v. Lawrence Natural Gas Co., 47 Pitts. Legal Jour. 346, upon which the defendant’s counsel chiefly rely. The name of the plaintiff’s wife was inserted in the lease as one of the parties of- the first part, but the lease was not executed by her but only by the plaintiff and the defendant. It is alleged in the statement of claim that the lease was from the plaintiff to the defendant, and it is admitted in the affidavit of defense that “ the plaintiff did grant unto the defendant company by an instrument of writing commonly known as an oil and gas lease, dated June 15, 1887,” etc. By the pleadings, the only parties to the lease under which the defendant went into possession were the plaintiff and defendant. For aught that is alleged, it was executed and delivered without the knowledge of the plaintiff’s wife.. To hold that she was a necessary party to the action would be to assume, without warrant, that she was a party to the lease. We think the action was properly brought in the name of the lessor. The affidavit of defense upon the question of damages is ambiguous, to say the least. It is open to the construction that what the defendant intended to deny was, not that the plaintiff was compelled to purchase gas elsewhere and to pay therefor the price stated in the declaration, but only that he was compelled thereto by the defendant’s failure to fulfil its covenant. The affidavit seems to be directed to the question of its liability for any damages, rather than to the question of the amount of damages for which it would be liable, if its failure to furnish gas during the months named was a breach of its covenant. But the fact that the defendant did not furnish gas during the months covered by the action being admitted, and it being determined as matter of law that it was bound by its covenant to do so, it follows that the plaintiff was entitled to judgment in the absence of a clear, distinct and unequivocal denial that the gas purchased by the plaintiff was reasonably necessary to heat and. light his premises, or that the price paid therefor was reasonable. Where it is not. clear whether an [346] averment of an affidavit of defense is of a fact, or of an inference of law from particular facts, not set forth, it is bad for uncertainty: Superior Nat. Bank v. Stadelman, 153 Pa. 634. We think the averment in question is open to this objection, and must be adjudged insufficient upon that ground. Judgment affirmed.