Phillips v. Coast

Opinion,

Mr. Justice Green:

The question of the good faith of the defendants in putting down the well No. 7 was submitted by the learned court below to the jury with so much care, with so many cautions, with so much exactness, and with such perfect legal accuracy, that we must assume it to have been found absolutely, and in accordance with the precise limitations fixed by the court; that is, we must assume that, from the appearances on the ground as they were in 1884, a reasonable man would conclude that Glade run was then east of the well; and, in addition to that, — for so the court left it to the jury, — that after the notice of the plaintiffs, if the defendants had made inquiry from them for the facts upon which they founded their claim of title, they would not have learned that Glade run was west of the well in 1884. This being so, there can be no question of the good faith of the defendants to be now considered by us. It was a question of fact, to be decided by the jury alone, and they have found it in favor of the defendants. There was ample testimony to justify the finding. The channel of Glade run was not definitely fixed, for the water of the stream ran in two courses, and which was the real channel in 1884 was fairly open to question. The notice of the plaintiffs fixed no boundaries, described no line, pointed out no marks. It was merely a general notice that the well was on their property. The same notice also included well No. 6, but that well has been found not to be on plaintiffs’ land. We are bound, therefore, to conclude that the acts of the defendants in putting down well No. 7 were done in the honest belief that it was upon their own land, and, that if they had made inquiry of the plaintiffs for the facts upon which they claimed title, such inquiry would not have revealed to them that the well was on the plaintiffs’ land.

Having, then, put down the well in the utmost good faith, why should they not be compensated for the cost of the well, which the plaintiffs have recovered and now hold, and by the use of which all the oil that the well yielded was obtained ? This is a kind of improvement of an unusual character, and one which particularly commends itself to the favorable consideration of the courts. It was an oil well, with all the machinery and appliances necessary to its operation. Now, without this well and machinerj'', the oil could not possibly be obtained. After it was completed, its operations were all for the benefit of the plaintiffs. They have actually received the entire advantage of its structure and maintenance, without a penny of cost to themselves, and without any risk. All the cost and all the risk were borne by the defendants. If the defendants had not put down the well, the plaintiffs would never have obtained the oil without themselves sinking the well at their own cost and their own risk. Obtaining oil from the bowels of the earth is a very different thing from obtaining crops from the surface of the ground. The oil exists only at a distance of hundreds of feet below the surface. If it is not developed by means of wells, it is the same as if it had no existence at all. It is, in a state of nature, of no use or value whatever to the owner of the land. In order to obtain it, he must, by absolute necessity, incur the expense and the risk involved in putting down wells to reach it, and draw it from the deep recesses of the earth. The defendants, in the most perfect good faith, expended their money in sinking this well, as the jury has found; but they have reaped none of the benefits. All of these have gone to the plaintiffs. They could not possibly have enjoyed those benefits, if they had been in the possession of the land, without incurring this very same cost. Therefore it is no hardship whatever to them to repay to the defendants the bare cost of the well and appliances, which belong to the plaintiffs now, and the whole benefits of which accrue to them alone.

The fund, out of which this repayment is asked by the defendants, is a part of the proceeds of the very oil which was produced by their own good-faith expenditure* in sinking the well. It has cost the plaintiffs nothing, and we know of no good reason, in law or morals, why the reasonable claim of the defendants should not be allowed. The proposition that oil is part of the land, and cannot be regarded as mesne profits, and hence the right to compensation for valuable improvements, has no application. The oil has been taken. It is not a question of staying waste, but of allowance for the cost of valuable improvements, actually necessary, and made in good faith. For such improvements compensation is allowed, whether that which is taken be minerals, oil, or other substance of the land, or not. This was fully decided in Kille v. Ege, 82 Pa. 102, and Ege v. Kille, 84 Pa. 333. There, large quantities of iron ore were taken, and we held that the defendants were entitled to compensation for their permanent improvements, which gave increased value to the land. That such was the character of the improvements in the present case, was not and could not be questioned. We are of opinion that the plaintiffs’ points were correctly answered, and that there was no error, either in the trial of the issue or in the final decree.

Decree affirmed, and appeal dismissed, at the cost of the appellant.