Pittsburg Vitrified Paving & Building Brick Co. v. Cerebus Oil Co.

The opinion of the court was delivered by Smith, J.: It requires but a casual reading of the contracts of November 5,1903, and of January 16,1904, to determine that no contractual relation whatever was created thereby between the plaintiff and the defendant. By the former contract the defendant agreed with Videtto, Dolan and Scott, on certain conditions, to assign “all its right, title and interest in and to the oil right in certain leases.” It was provided therein that the party of the second part should drill a certain num [606] ber of wells on the land, and if they should drill any wells producing gas having a volume of 3,000,000 cubic feet or more per day, and if the Independence Gas Company did not take or claim such well, the brick company would take the same and pay the actual cost of drilling, etc. In the contract of January 16, 1904, between Videtto, Dolan and Scott and the Cerebus Oil Company, it was expressly stipulated that no interest in the gas rights should be assigned, but if in drilling wells the Cerebus company should bring in a gas-well having a volume of 3,000,000 cubic feet of gas per day Videtto,. Dolan and Scott would take the same and pay the actual cost of drilling, etc. On the trial these contracts were introduced in evidence, and they not only failed to prove the plaintiff’s claim that by them the defendant agreed to pay the plaintiff the cost of drilling and equipping the gas-well in question, but effectually disproved such claim. The contracts, however, prove that after drilling and equipping the gas-well the plaintiff had no right to the gas, but that it belonged to the defendant. The evidence in this case does not disclose the derails of the contracts between the brick company and the owners of the lands, but it is assumed and asserted by both parties that the brick company owned or had control of the oil-and-gas rights therein. In the contract of November 5 it undertook to convey the oil rights in a portion of the lands to Videtto, Scott and Dolan, under certain specified conditions, among which was the agreement to pay for the drilling and equipping-of gas-wells of the specified volume. In turn Videtto, Scott and Dolan, in the contract of January 16, without any reference to their contract with the brick company, contracted under certain conditions differing materially from the conditions of their contract with the brick company, and undertook to convey the oil rights in a portion of the land embraced in the contract with the-brick company to the Cerebus Oil Company. The Cerebus Oil Company did not assume any of the obligations: [607] of Videtto, Scott and Dolan to the brick company, nor did the brick company in any way accept the responsibility of the Cerebus Oil Company for the performance of the conditions of the former’s contract of November 5 with Videtto, Scott and Dolan. The contracts of November 5 and January 16 were more in the nature of contracts to sell the oil rights in the lands therein respectively referred to than of assignments of leases. Practically the only parallel between those contracts was that the grantor in each only undertook to convey the oil rights in the lands therein described, and agreed to pay the actual cost of drilling, casing and equipping any gas-well brought in by the grantee having a volume of 3,000,000 cubic feet of gas per day. In the contract of January 16 this was an absolute agreement. In the contract of November 5 it was the agreement provided, the well was not taken or claimed by the Independence Gas Company. Hence it appears that there was no contractual relation or privity of contract between the brick company and the Cerebus Oil Company. However, it was pleaded by the plaintiff, and there was evidence tending to prove, that the Cerebus Oil Company had the right to, and did, drill, case and equip a gas-well having a volume of 3,000,000 cubic feet per day, that the brick company alone owned the gas rights in the land upon which the well was situated, and that the brick company, after the well was drilled, cased and equipped, agreed to pay the plaintiff the actual cost thereof. The court made no special findings of fact, but these facts are necessarily involved in its finding in favor of the plaintiff. There was ample consideration for such a contract, and sufficient evidence to support' a finding that such a contract was made subsequent to the completion of the well. The judgment is therefore affirmed.