Cox v. Miller , 1944 Tex. App. LEXIS 993 ( 1944 )

I agree that the judgment should be affirmed. I am unable to see that it is material to the question for decision whether the lease was a "drill or forfeit" lease, a "drill or pay" lease, or an "unless" lease, or when, whatever its classification, it terminated.

Lessors did not own the casing, and the lease gave them no contract right to acquire it. On the contrary, Lessors expressly recognized in the contract that "Lessee shall have the right at any time to remove all machinery and fixtures placed on said premises, including the right to draw and remove casing." (Italics mine.) The contract neither expressly nor impliedly imposed any duty upon Lessee to remove his casing. So far as affected by the contract, he could remove it or not. He could abandon it, if he so desired. There was, therefore, no basis for an implication of a time element qualifying his optional right to remove it.

Had the contract while declaring Lessee's right to remove the casing have specified a limit of time in which he should exercise such right, the natural purport of such provision would have been to imply a duty to exercise the right, and, of course, to exercise it within the time specified. If a reasonable time was specified the duty would be implied to exercise the right in a reasonable time. If no time was specified, but the contract, or the law, imposed a duty to remove the casing at all, then the law would, perhaps, imply a reasonable time.

There are two or more good reasons why in my opinion that principle is not applicable here. In the first place, neither the lease contract nor the law expressed nor implied any duty to remove the casing. But, even if that proposition be not warranted, the contract did not leave the time element to implication. It says "at any time", which expresses an unlimited time thereby excluding any implication of a limited time.

Of course one provision of a contract may, considered alone, express an intention that a right given or recognized may be exercised "at any time"; and yet another provision, or other provisions, may, standing alone, express an intention with which it would be inconsistent that such right be exercised unlimited as to time. In such a case the expressions of apparently different intentions must, if possible, be reconciled. In other words, there would be a contract which, being ambiguous, calls for construction. If need be, general language, such as the phrase "at any time" may be limited or qualified, if necessary, to effect a more general intention expressed, or perhaps necessarily implicit, in some clear certain purpose of the contract.

In my opinion this is no such case. What purpose expressed or necessarily implicit in the lease is inconsistent with the right of the Lessee to draw and remove the casing at any time? This was not something to be done as incidental to the rights of the Lessors or Lessee under the lease and which would be defeated or in some way adversely affected by failure to do it in a reasonable time. The provision in question was not the source of Lessee's title to the property, not a qualification upon his right or title to it. It certainly was not the source of Lessee's right to draw and remove the casing while the lease was in force. Lessee had that right by virtue of the easements granted by the lease, which, of course, continued to the termination of the lease. The only practical effect of the provision, insofar as it could relate to any right of the Lessors, was to license the Lessee to go upon the land after termination of the lease for the limited purpose of taking away his personal property without being a trespasser. In practical effect it amounted to no more than written consent given in advance to the Lessee to enter upon Lessors' land and take away Lessee's own personal property in which Lessors had no interest and which consent was necessary only because taking away such property even by its owner involved going upon the Lessors' land after the former easements therein had terminated. This was a consent which Lessors could have given orally at any time. Why, then, could they not give it in writing in advance? Let us assume that the actual intention of the parties to the lease was to give or acknowledge the right of Lessee to draw and remove the casing at anytime, or, in other words, for an unlimited time. Unquestionably they had the power and right to make such an agreement. How then could they have expressed such an intention any better than they have done in this lease by the provision in question?

My tenant moves, leaving a stove in the back yard, intending to abandon it. The bare fact that it is on my land does not work a transfer of title from him to me. If my neighbor across the street, recognizing the abandonment, takes possession of the stove and moves it to his house, he becomes the owner of the stove. Pearson v. Black, Tex. Civ. App.120 S.W.2d 1075. He may have committed a technical trespass by going on my land without my consent. But my consent was not necessary to his acquisition of title to the stove. Since the stove was not mine and not a part of my land, if I sue my neighbor for trespass, the value of the stove cannot, of course, be included in the damages recoverable for the trespass. If my tenant, upon quitting the leased premises, leaves the stove but without intention of abandonment, no relinquishment or transfer of title results. Without my consent, expressed or implied, he could, perhaps, not come upon my land, even for the purpose of taking away his own property without being guilty of a trespass. But ten years later, no adverse possession having intervened, with my consent then given or theretofore given and remaining unrevoked, he could go upon my land and take away his stove without being guilty of a trespass. If in the rental contract I had given my consent in advance and had not seen fit to limit it in time, the consent would continue indefinitely unless revoked. Granting that I could revoke the license, I could not wait until he came for his property and then revoke it so as to deprive him of it. If the presence of the property on my premises became objectionable, [ could revoke the license, — if it was nothing more than a license, — after reasonable notice and not with such effect as virtually to deprive him of his property against his will. Adams v. Weir Flagg, Tex. Civ. App. 99 S.W. 726.

In saying, as I have, in effect that the provision in question amounts to no more than a license, I do not mean to be understood as expressing the opinion that such was the only purpose of such provision. In fact it may not have been a conscious purpose at all, but if not, it was in effect necessarily included in a larger purpose. The larger purpose was no doubt to settle in advance that the "machinery and fixtures," including the "casing" in the well, was intended not to become in any event real fixtures. The provision was one common in such leases, since a time when no one dreamed that a lease was in effect a deed conveying oil or gas as corporeal real property and vesting the grantee with a determinable fee estate in such substances as distinct from the land wherein they might lie. When such a provision first appeared in leases, the leases were regarded as evidencing, if not mere licenses, at most such incorporeal rights in the land of another as that in a very true and proper sense casing in a well could be a real fixture annexed to the land, since the land including the oil and gas therein, if any, while remaining in place belonged to the Lessors. The purpose of such a provision, when first so used, was like that mentioned in Wright v. Macdonnell, 88 Tex. 140, 30 S.W. 907, 909, as to which it was said: "It was evidently contemplated that the law of fixtures should not apply. * * * The object of the parties was not to leave their rights to be determined by the law of fixtures, but to fix them by express agreement." "The intention of the party making an annexation [of personal property to land, so as to become real fixtures and therefore a part of the land] is," according to Lewis' Lectures on Real Estate, p. 8, "the controlling element in determining whether the thing annexed is a part of the realty or continues personalty." Then, how can any question as to such controlling intention be more completely and certainly forestalled than by the provision under consideration, wherein Lessors recognized in unqualified terms the right of Lessee to draw and remove the casing at any time?

I have not taken the time to investigate fully into the origin and full history of the notion expressed in the oft repeated dictum to the effect that when one has a recognized right to remove his personal property from the land of another whereon it is lawfully situated, such right is qualified to the extent that he must exercise it within a reasonable time upon penalty of losing his property. I think it may safely be assumed that it had its origin in the law of real fixtures as affected by the principle of abandonment. In Wright v. Macdonnell, supra it was said:"In the absence of a special stipulation to the contrary, fixtures placed upon the demised premises by the tenant are personal property,subject, however, to become parts of the realty, if not removed by him during the time allowed him by law for their removal." (Italics mine.) It is a pretty safe guess, I think, that upon no better foundation than this rests the vastly expanded idea that regardless of the intention plainly expressed by the words of a contract, the law will override such expressed intention and substitute for the unlimited import of the words "at any time" the limited import of the words "within a reasonable time." This idea — mere dictum in all the cases I have seen — has no support in the above quotation from Wright v. Macdonnell, supra. The rule there declared related to the relation of landlord and tenant, and even so, was declared to exist "In the absence of a special stipulation to the contrary." We have such stipulation to the contrary in this case.

But further, under the modern view in this state of the nature of such a lease, the casing in the well was never, even in the absence of any stipulation, annexed to the land of the Lessors so as to become a real fixture. One of the tests where the question is not settled in advance by contract is "adaptation of the fixture for use with the realty." Lewis' Lectures on Real Estate, p. 8. Considering the land as realty, distinct from the oil and gas in the land, the casing in a well has no adaptation for use with the realty. The only realty to which the casing might seem to be annexed was the oil or gas in place under the ground. It would not attach to the oil or gas or to the leasehold interest as a real fixture in this case, since, if the lease terminated as long ago as one year after completion of the well, it was only because the well was a dry hole. In other words, there was no realty consisting of oil or gas in place to which the casing could be annexed. Besides, it has been held that the casing in a well does not pass by the conveyance of a leasehold estate. Moore v. Carey Bros. Oil Co., Tex.Com.App., 269 S.W. 75, 39 A.L.R. 1247. If it were a real fixture, it would, of course, pass.

While from my view point I do not regard the nature of the lease or the time of its termination material to the question to be determined, I do not wish to be understood as assenting to some of the views expressed in the majority opinion.

In my opinion the lease, properly construed, is not an "unless" lease, but a "drill or forfeit" lease. Summers Oil and Gas, Sec. 438. Evidently an "unless" lease form was used, but there is a conflicting specific provision obligating the lessee absolutely to commence a well not later than December 1, 1937, or else the lease would terminate. That such provision is in necessary conflict with the "unless" provision is very evident. Under the "unless" provision Lessee had the right not to commence a well before September 13, 1938, and not even then if on or before said date he paid a stipulated rental. Under the special provision Lessee could not delay the commencement of a well longer than December 1, 1937, without the lease being subject to a forfeiture and without any option to avoid such forfeiture by payment of rentals. I think the provisions of an "unless" lease are so generally known and the use of printed forms in executing such leases is a practice so general, that we can say from our judicial knowledge of such facts that the special provision was written into an "unless" form of lease. If so, this enables us to give effect to such part of the lease by rejecting the printed part in conflict with the written part upon the principle that in such a case written provisions control over printed provisions. Even in that case, however, there may be some question whether the conflict extends to include the provision reading as follows: "Should the first well drilled * * * be a dry hole, then and in that event if a second well is not commenced on said land within 12 months thereafter from the expiration of the last rental period for which rental has been paid, the lease shall terminate as to both parties, unless the lessee on or before the expiration of said 12 months shall resume the payment of rentals in the same amount and in the same manner as hereinbefore provided. And it is agreed that upon the resumption of payment of rentals as before provided, that the last preceding paragraph hereof governing the payment of rentals and the effect thereof shall continue in force just as though there had been no interruption in the rental payments." I shall not take space to detail the reasons which seem to me to compel the conclusion that this provision must also be rejected as involved in the before mentioned conflict, because it is immaterial whether it is or not. If it is not included and therefore rejected, the result is to show that the lease is a "drill or pay" lease, which, the same as a "drill or forfeit" lease, is, so far as I know, under all authority regarded as terminable by a forfeiture provision as distinct from a limitation. Summers Oil Gas, sec. 334. The well that was drilled was delayed in commencement, but there was no forfeiture because of a waiver thereof, as we all agree. Even if the well was a dry hole the forfeiture for failure to commence another well or pay rental was just as clearly waived by the Lessors' acquiescence in the efforts of Lessee to make the well a gas producer. There was no forfeiture, in any event, in the absence of a declaration of forfeiture or legal equivalent thereof. No forfeiture having been declared, the lease under the uncontroverted evidence terminated by reason of the limitation of the term at the end of five years from the date of the lease.

If I am in error in the view that the Lessee's right to draw and remove the casing was not limited as to the time in which to exercise such right, then nevertheless the lease terminated so recently before Lessee sought to draw and remove the casing that, as a matter of law, there was no unreasonable lapse of time.