Smith v. United Crude Oil Co.

JAMES, J.

Plaintiff had judgment against the defendant for a large sum of money claimed as damages. Defendant has appealed, and presents the judgment-roll and a hill of exceptions. The cause went to trial upon an amended and supplemental complaint and the answer made thereto. Issue was raised as to matters hereinafter discussed. The answer further pleaded in defense laches on the part of plaintiff and the interposition of statutes of limitation.

Predecessors of the assignors of defendant were the lessees named in a certain lease affecting land which at the time of the commencement of this action was owned by the plaintiff. The defendant succeeded to the rights of the original lessees. The lease mentioned was one made for the purpose of oil development under which, as we construe the instrument, the lessees were entitled to the exclusive possession of the property for the purpose of prosecuting the business designed to be accomplished. The lessees did so have the property, and this defendant, while in possession of the same, made a sublease on the twenty-fifth day of May, 1910, to cover a period of time up to the twenty-fifth day of May, 1915, and wherein the right to occupy certain portions of the land and to erect thereon buildings for the purposes of an oil-well supply business, was granted to a third party. In April, 1913, the plaintiff gave notice to the defendant, calling for an account of rents and royalties on oil production, and further stating an objection to the sublease, terming

[468]

it an encumbrance against the conditions of the lease, and requiring the sublease to be vacated. This-demand having been apparently disregarded, a written notice was given on the eighth day of April, 1913, declaring the lease of the defendant terminated and void. This action followed. In the complaint plaintiff alleged the failure of the defendant to make account for rent and oil royalties; alleged that the sublessee had been allowed to “occupy and use large portions of the surface of the said land for a long period of years for purposes not contemplated by or within the provisions of said lease, . . . that the said defendant has been collecting of and from said Associated Supply Company the sum of about $100 per month from and after the sixth day of May, 1910, to the date of the commencement of this action and applying all of said sums to its own use, and that the said defendant has failed, refused and neglected to pay the same, or any part thereof, to the plaintiff, and has failed, refused and neglected to clear said land of said encumbrances.” The prayer of the original complaint was that the lease be terminated, that an account be had, and “for such other and further relief as to the court may seem meet and proper.” The cause was tried upon the original complaint and judgment was rendered for the plaintiff, allowing recovery for the rents collected from the sub-lessee, amounting to $5,843.20. The cause was taken on appeal to the supreme court and decision made therein, which is found in 179 Cal., at page 570, [178 Pac. 141], The court there held that no term of the lease of the defendant prohibited the subleasing, and that therefore there had been no violation of any such covenant or agreement. The court did, however, declare that, as the lease held by the defendant was made for a particular purpose, the plaintiff might make his claim under section 1930 of the Civil Code, which provides: “When a thing is let for a particular purpose the hirer must not use it for any other purpose; and if he does, he is liable to the letter for all damages resulting from such use, or the letter may treat the contract as thereby rescinded.” The court further remarked that the complaint did not aver any damage, and that no proof was shown to have been offered of any damage to plaintiff by reason of any such